Offshore companies used to be extremely popular a decade or two ago. Are they good business instruments today? Fortunately, the answer is positive! Of course, the offshore realm has changed considerably, and you have to make an informed choice. You may have your doubts, of course, but in 2024 you can still have almost all the benefits of the offshores!
Why Choose an Offshore Jurisdiction?
Here are the main advantages that are typically associated with an offshore jurisdiction:
- The cost of the official company incorporation procedure is typically kept at an affordable level.
- Offshore companies incorporated in a respective jurisdiction enjoy low or even zero tax rates.
- The privacy offered by offshore destinations is not as high as it was twenty years ago, for example, but it is still at a sufficiently high level. This is an essential criterion for some entrepreneurs, and this is the primary value they are looking for.
- Administrative requirements for offshore companies are quite relaxed: you don’t need to submit tax returns or financial reports to local authorities. However, you are still required to keep them, and sometimes you need to send them to your registered agent (who will keep them confidential, of course).
- Offshore destinations often offer a convenient business environment, and doing business is a simple procedure.
Each offshore jurisdiction strives to attract as many foreign investors as possible, so they try to offer as many perks as they can. What are the jurisdictions that seem to be the most favorable places when it comes to company formation? Well, the top list usually contains Nevis, Panama, Anguilla, the Bahamas, Cayman Islands, British Virgin Islands (BVI), Seychelles, Marshall Islands, and Belize, to name just a few.
Top 10 Reasons to Set Up an Offshore Company
If you still doubt whether you need an offshore company, let’s look at this instrument under a microscope. Here are the most widespread reasons why entrepreneurs opt for offshores.
Asset protection
If you have considerable capital, you should think of its protection. Offshore foundations, trusts, or holding companies are perfect instruments that will protect your assets against greedy relatives or creditors. Offshore destinations give all possible opportunities for customized inheritance, succession, or family settlements: a trust is a much more versatile instrument in this case than a will. If asset protection is your top priority, you can opt for the best jurisdictions in this respect, such as Nevis, Belize, or the Cook Islands.
Privacy and security
Money loves silence – and business too. Many wealthy individuals and company owners want to keep their identities secret, which makes them look for safe havens – and they find them! However, the conditions differ from offshore jurisdiction to offshore jurisdiction, so you’d better talk to a specialist before you choose one (you can click on the above link and use the live chat to get basic expert assistance for free).
Relaxed reporting requirements
Some offshore jurisdictions are not interested in your financial and tax reporting at all, that is, you are not required to submit any documents to respective local authorities. On the other hand, remember to adhere to FATF requirements: keep your documents in order and have them ready for inspection.
Tax optimization
Many foreign entrepreneurs form an offshore company first of all to take advantage of low or zero tax rates. If you pay no corporate tax on your profits, it means that you can save more funds to invest in your business and eventually expand it. It does not mean that you can totally escape tax payment: you will be liable for taxes at the place of your fiscal residence, of course. In 2024, offshore companies have a lot of freedom in choosing where they will pay taxes taking into consideration applicable international agreements and double taxation treaties.
Low capital requirements
There are jurisdictions where you can have the authorized capital of 1 dollar if you want to. Of course, this may cast a shadow on your image in the eyes of your business partners, but still – you should know that this opportunity exists and you can use it. Company registration expenses are quite affordable, too.
Affordable operating costs
In most cases, you will not have to rent an office in the country where you register your business and you can run your company online – all you need is a laptop! Many jurisdictions impose economic substance requirements (which include accounting, reporting, local employees, office, etc.). This tendency is slowly conquering offshore space as well, but there are still available destinations where these expenses will be minimal. The majority of offshore countries will not require you to have your financial statements audited, for instance, which will result in substantial savings.
Straightforward company registration procedure
You can set up an offshore company without much hassle using the services of a proxy or a registered agent. The times when hard copies had to be sent are gone, too: you can send your package of documents electronically. On the whole, you will have to jump through much fewer administrative hoops to get a fully functional offshore company than solid onshore jurisdictions.
Top-notch banking
Banking services are extremely important when we are talking about business: that’s where speed and seamless operations matter. Not all offshore jurisdictions offer good banking, and you have to choose a proper bank even in those that are considered excellent financial hubs. Still, you can find excellent solutions! It is an open secret that onshore banks (especially those located in high-ranking jurisdictions like Switzerland) frown upon offshore companies and are not very willing to create accounts for them. This is understandable as an offshore company is a risk, and it requires a lot of verification procedures.
However, there are a lot of good offers, but you need to talk to bank employees in advance. Click on the link above to talk to an expert who will help you choose the right bank for your business at no fee. We also offer a very convenient pre-approval service: it costs a negligible amount, but it allows you to understand whether the bank will onboard you before you collect a complete package of documents and make any further steps.
The whole world is open to you!
No matter whether you are a private investor or a large corporation, an offshore entity will open all the global markets for you and give you endless opportunities. Attract new customers and partners, register your intellectual property, and encounter no limitations at all.
You can follow the above link to get more details or talk to an expert.