Discover the allure of offshore jurisdictions, often small island nations with limited economic pillars. These jurisdictions attract entrepreneurs worldwide by offering favorable conditions for company formation and banking, alongside their prominent tourism industry.
Offshore jurisdictions are typically small island nations that have very few pillars to base their economy upon. Therefore, in addition to tourism, they attract entrepreneurs from all over the world by offering really good conditions for company formation and banking. Investors come here to take advantage of low taxes, privacy, asset protection, and other benefits that are important to them.
Is it difficult to register an offshore company? Well, it may be tricky if you are new to it, but it is quite straightforward for a specialist who deals with company registration professionally. You can read an article on offshore incorporation services on our portal and get in touch with our competent experts who will help you get a fully operational company (with a bank account, if you need it) in a matter of two weeks.
Offshore Company: Main Reasons Why
If you decide to form a company half the world from your home country, you should have a good reason for that. And offshore companies do offer a lot:
- Tax exemption or really low tax rates
- No need to submit or audit any financial reporting
- Business owners can keep their identity secret
- Reliable asset protection
- Some advantages specific to each jurisdiction
And this is something entrepreneurs cannot have in their home country.
However, they are in no hurry to relocate: an offshore company can be established and managed remotely. This is very convenient and far-sighted: you have a Plan B, your assets are diversified (and so are your risks), and you can stay at home as long as the economic and political situation seems fine. And if any signs of trouble loom on the horizon, you have a place to go to.
Offshore companies are also in great demand with digital nomads who are looking for a simple procedure of company registration, hassle-free maintenance, and a beautiful environment with well-developed infrastructure to live in. And offshores have it all!
Are Offshore Companies Legal?
If something is legal, it functions according to the laws. Offshore companies are formed according to local laws and comply with all international requirements imposed by regulators like FATF or OECD. Thus, they are perfectly legal.
Why is this question often asked, anyway?
From time to time, we come across headlines in mass media related to offshore scandals, fraud, tax evasion, and so on. That’s the reason why many people have this association. What is more, offshores used to be the instruments for aggressive tax optimization several decades ago, and they still have this flair around them.
However, present-day offshores are just instruments. It’s like a knife: you can use it to do harm or you can cut fruit with it. This does not make the knife itself illegal.
All you need to do is to form your offshore company according to the local laws, make sure to comply with the laws of your home country (some states want you to declare your foreign assets), and conduct a lawful activity without resorting to some dubious schemes.
Our consultants will help you competently set up your company to make it a perfectly legitimate instrument that will not infringe on any laws.
Where to Form Your Offshore Company?
The choice is really wide: there are about 100 offshore countries, zones, and territories in the world! Of course, all of them come with different perks and offer various conditions. Our experts will ask you a lot of questions before they shortlist the jurisdictions that will be really suitable for you.Â
Just to give you an example, let’s take one aspect – the purpose of company establishment:
- Are you going to provide banking services? You will need a banking license. Not all countries issue it in a simplified procedure, but Vanuatu, Puerto Rico, St. Lucia, and Panama do.
- Entrepreneurs engaged in gambling business should look no further than Costa Rica or Curacao where they can easily get a gambling license.
- Do your partners mainly come from China? Singapore and Hong Kong will be the best jurisdictions in this case. You can set up your company in one jurisdiction and get banking services in the other one.
- Are you planning a start-up in the financial sphere? Consider Luxembourg, Estonia, Ireland, or the UK.
- You have capital and you need reliable protection from creditors? Nevis and Belize will do the trick perfectly.
- Finally, if you want to enter the US market, the best option is to set up your company within the USA. There are several states that offer special conditions to attract entrepreneurs who wish to have offshore companies: Wyoming, Delaware, and Nevada.
Offshore Companies: What About Taxation?
If you want to have complete tax exemption, you’d better hurry: the number of jurisdictions that offer zero taxation is diminishing every year due to increasing pressure from international regulators. Fortunately, they still exist, and you can take advantage of them!
On the whole, there are four types of offshore jurisdictions in terms of taxes:
- You pay zero income tax if you get your profit outside the country of incorporation
- There are special tax regimes for companies registered in the jurisdiction
- The taxation system is territorial, which means that you will not have to pay any taxes if you do not generate any profit within the offshore territory
- Jurisdictions that are not associated with low taxes offering preferential tax conditions to certain businesses and activities
One important thing to check is whether an offshore jurisdiction has a double taxation treaty with your country of tax residence as it will allow you to considerably save on taxes.
Summary
The most important thing about an offshore company is to correctly choose the jurisdiction and rely on competent specialists who will guide you through the process. You can book a free session on our portal (follow the link above) where we will help you choose a suitable jurisdiction for your particular situation – and a reliable bank to open a corporate bank account if you need it. You will also need a local registered agent to set up your company (this is a mandatory condition), and we will help you get one, too.
Do you have any questions? Contact us – we are just a click away!
