Managing your assets and wealth is very important; especially during times when the economic outlook is unstable. One way of accomplishing this is by way of
offshore company formation. These are formed and governed by way of the laws of certain jurisdictions and exempted from the local tax regime. In general, these businesses aren't allowed to engage in business transactions inside the country of registration.
According to the United Nations working paper, there are some 2.5 million IBC’s registered around the world. The Caribbean and Latin America regions make up 37 percent the Pacific and Asia region 30 percent, Europe 25 percent while the Middle East and Africa account for 8 percent. In the U.S a report by the Government Accountability Office was quite revealing. It found that over 60 of the largest contractors used by the federal government and more than 80 of the largest public companies in the U.S had offshore subsidiaries. These numbers clearly show that there are benefits to generally be gained from incorporating offshore.
Advantages Of Offshore Incorporation
• Asset protection. This is important because it distances you from your assets. As a result your assets are protected from court suits or seizures.
•You are exempted from local corporate taxes and duties so long as you don't carry out any commercial activities within the registering jurisdiction.
•Confidentiality. This is one reason many people incorporate offshore because you don't have to disclose your identity.
•There are no restrictions on the business activities you can engage in.
•You can basically hold shareholder meetings from any location.
•There are no minimum share capital requirements and you can issue bearer or registered shares.
•You are not bound by any audit requirements and you can do your book keeping from any place in the world.
•You do not have to publish any annual returns or open your accounts for scrutiny.
•You don't have to keep local offices or appoint local directors.
Now that you have an idea of what you can gain financially, it is important to have a look at what an IBC can do for you. Generally an International Business Company can take part in any commercial activity that is legal. However there are actually certain restrictions including all sorts of insurance and re-insurance, trading in commodities or stocks and engaging in banking activities. If you plan to engage in any of the above you would have to get the necessary licensing.
Commercial Activities That An IBC Can Engage In:
• It can participate in importing/exporting activities.
• It can serve as the holder of title deeds to real estate property.
• It can be used to enter into leasing agreements for property or machinery.
• It can be used as a holding company.
• It can be used as a vehicle for managing both domestic and foreign wealth.
It is advisable to take the utmost caution when looking for advice on
offshore company formation. A reputable offshore service provider is considered the right choice for you. It is because such a firm would be familiar with the intricacies of offshore taxation. Avoid at any cost any firm that cannot advise you on tax penalties or financial consequences you might potentially face. Only choose experts who can give you real advice.
