Tax havens
Generally speaking, a tax haven is a jurisdiction in which taxes are either applied at a low rate or not at all. Well-known examples of tax haven jurisdictions include Panama, Belize, the Seychelles, the Cayman Islands, the Isle of Man and Hong Kong. Very often, such territories are also called offshores
, with companies registered under these jurisdictions described as offshore companies
.
An offshore company is a company established in order to operate and perform business activities outside the jurisdiction in which it was officially incorporated, as well as outside (or off the shores of
) the place of residence of its directors, shareholders and beneficial owners, which may be crucial for tax planning in certain legal systems. Usually, an offshore company is established in order to receive certain legal or tax benefits, to allow for a particular corporate structure or to protect the confidentiality of the beneficial owner and/or asset holder.
It is widely recognised that in the modern, dynamic business environment, with most countries collaborating to create an intergovernmental tax-monitoring system, it is becoming more and more difficult to achieve your corporate and personal goals. Tax havens provide the perfect environment and the right tools to create a unique, functional corporate structure that suits your needs. Confidus Solutions will provide you with the most efficient solution, tailored just for you.
Features and advantages of offshore companies
Reducing the volume of applied taxes and securing confidentiality aren’t the only advantages of setting up an offshore company in a tax haven. Although tax planning is one of the major advantages offered by offshore companies, the chance to greatly reduce business expenses and maintenance costs is also a very attractive benefit.
Below you will find the six main benefits of incorporating an offshore company in one the tax havens listed here:
Tax reduction
Incorporating a company in tax haven provides a legal means to reduce the corporate taxes levied, and this is usually one of the main arguments for relocating your business to an offshore. Non-resident companies can enjoy a low-tax regime depending on the jurisdiction of incorporation. Bear in mind that international tax regulations can be extremely complex nowadays, and it is essential to consult with an experienced tax specialist. It is vital to ensure that there are no conflicts with corporate tax obligations in the jurisdiction where the business actually operates.
Privacy
In some tax haven jurisdictions, non-resident companies are not obliged to make public any financial documentation or private information relating to directors and shareholders. Most offshore jurisdictions will not pass on any of this information to third parties, including other countries, unless the individual is suspected of involvement in criminal activity.
Simple maintenance
Usually, there are no strict requirements or obligations regarding company management, so the directors and executive staff may make decisions remotely, using power of attorney or nominee services. The need for staff and physical premises may be met by the elegant and cost-effective solution of virtual office services.
Asset protection
Many offshore jurisdictions can be used as valuable corporate tools for asset protection. Typically, offshore legal entities are used for holding intellectual property rights or real estate investments.
Lower expenses
Comparing onshore and offshore jurisdictions, offshores usually offer a faster and more straightforward company incorporation procedure. Annual maintenance is usually easier and cheaper as well, making company registration and maintenance much more affordable.
Lower minimum share capital requirements
Incorporating an offshore company usually requires only a very small amount of share capital, and in certain tax haven jurisdictions there are no capital requirements at all, allowing you to minimise the cost of incorporation.
Offshore assessment advice
Confidus Solutions has reliable partnership arrangements with long-standing and experienced international tax advisers and company registration agents worldwide, providing us with the ability to incorporate offshore companies in a number of tax haven jurisdictions. To find out more and receive a unique solution - contact our team today.
Top-choice jurisdictions
There are numerous tax haven jurisdictions all across the globe. Each offers different tools for tax planning and achieving an optimal corporate structure. We can recommend the best jurisdiction for your company depending on your desired goals, as each of the tax haven areas has its own unique benefits. Here are the top five jurisdictions we generally recommend to our clients, but we can also offer other jurisdictions if required. Please contact us for further information.
Luxembourg
Luxembourg is a small central European country bordering Belgium, France and Germany. It is renowned for its business-friendly environment and corporate tax regulations, which together allow foreign companies to reduce the amount of tax payable by incorporating within its borders. Approximately 33% of the United States Fortune Top 500 businesses have subsidiary companies in Luxembourg, which offers many options for foreign investment. One of the most well-known legal structures in Luxembourg is the investment fund. Over the last 50 years, around 3500 investment funds were incorporated in Luxembourg.
The Cayman Islands
Currently, the Cayman Islands tax haven offers a very attractive tax regime. In the view of Crystal Stranger, president of business tax firm 1st Tax, the Cayman Islands now provide 'probably' the biggest [tax] loophole for individuals as well as multinational corporations". The tax planning advantages offered by the Caymans are obviously worth their price, as many famous businesses from around the world have assets in this tax haven.
The Isle of Man
The Isle of Man is a British Crown-dependent, self-governing jurisdiction, lying in the Irish sea between Northern Ireland and England. Certain companies are subject to corporate income tax at the rate of 0%; however, banking businesses and land and property income are subject to a 10% tax rate. The Isle of Man can be the perfect location for establishing a limited liability company within the framework of a larger corporate structure for tax planning purposes. The Isle of Man is not part of the EU, but EU citizens are permitted to travel without a visa and to reside on the island. However, for employment purposes a work permit is required. The Isle of Man’s legislation also provides great benefits for pensions.
Belize
Belize is a small country on the eastern coast of Central America, to the south of Mexico, formerly known as British Honduras. This jurisdiction has a lot to offer international investors as well as corporate giants, with its favourable tax regime and banking legislation. Under the provisions of the International Business Company (IBC) Act of 1990, companies registered in Belize are fully exempt from all types of taxes and stamp duties on income from any source. An international business company (IBC) incorporated under the laws of Belize is a perfect solution to secure your confidentiality, as nominee services are allowed, but no information on directors and shareholders is entered into the public register.
Panama
Panama is a country in Central America, well known as a tax haven. Panama is a vital transport hub, as it has the Panama Canal, which serves as a connection for numerous trade networks between the Atlantic and Pacific Oceans. This jurisdiction is commonly used as a base for opening and operating personal and corporate bank accounts, as local legislation provides an investor-friendly environment. All information regarding bank account beneficiaries is kept confidential. Companies incorporated within the jurisdiction of Panama may be used as a means to achieve your required corporate structure.
Other jurisdictions
Other famous tax havens and offshore jurisdictions include St. Kitts and Nevis, the British Virgin Islands, the Seychelles, Hong Kong, Jersey, Liechtenstein, Cyprus, Panama, the Bahamas and Gibraltar.
Confidus Solutions
Confidus Solutions will help you evaluate all of the possible options and choose the most efficient, tailored solution to achieve your personal goals. We have many years of expertise in this area and our experienced agents and lawyers can incorporate your company in any jurisdiction worldwide. If you require more information, take a look at our offered solutions or contact us for an offer unique to you.