If you’re thinking about forming an offshore company, you might ask what the benefits are. Depending on where you form your offshore company will depend on what that answer is, but broadly speaking there are several that you should be aware of.
Taxation for Offshore Company
In many cases, an offshore company is not taxed the same as companies trading in that jurisdiction. This is because they aren’t actually allowed to trade in that jurisdiction. Just like schemes in America that allow people to sign up withhold tax until a certain form is returned to show that they would pay tax in another company, these ‘offshore’ companies aren’t actually considered taxable in most cases. In some, there are minimal tax requirements. You will, however be taxed where the bulk of your business directors are based, or in the various jurisdictions you are all based in
Thin corporations for Offshore Company
This is the concept that offshore company aren’t charged as much equity to form as other companies in that jurisdiction. It’s not always the case, so you should check with your legal advisor before embarking on anything like that.
Legal jurisdiction for Offshore Company
Depending on where you are based will depend on if your company will be allowed to use its offshore base as its legal jurisdiction. This is often a very sticky and hotly contested issue, so you should engage legal counsel to ensure that you can, legally, use your offshore base as your legal jurisdiction.
Bank accounts for Offshore company
In most cases an offshore company can open bank accounts in their jurisdiction. Your offshore company may be formed solely to give you access to a protected bank account, in which case, you should discuss that move with your legal and financial advisors at your earliest convenience to ensure that it’s the right choice for you. If it is, you should ensure that you provide all relevant information to ensure that the money held there is appropriately accounted for and, if possible, not taxed.