Foreign individuals and corporate entities received myriad benefits in off-shoring the banking to a tax haven. Few people know that you can even offshore companies for tax benefits. The aforementioned arrangement is referred as an IBC or International business company. Caribbean Style company act is the company act adopted by the above-mentioned type of company. On the other hand, the type of act is not used as commonly as the Channel Islands model which is used to create off-shored companies in Europe, the Turks and Caicos islands and St. Kitts.
An IBC or off-shored company can be defined as a company that is created in a tax haven specifically for the purpose of doing business all over the world except the country of incorporation. However, the company owner cannot sell items in the off-shored country but they may lease land for even fifty years depending on the country and it may conduct business with other local IBS’s in the same country and even enjoy local banking facilities. Almost all IBC’s conduct financial business without any problems from wherever they are located and this has a lot of benefits for the parent company. Below are a few of the benefits.
There is no need to hold an annual meeting and telephonic meeting can be done as needed. Also, the directors, shareholders and officers can be any nationality and having the ability of keeping their names private if necessary. The company can also benefit from the savings with a reduction of professional fees in certain countries. Relative to ones needs, an option of a tax haven can be done wherein tax is paid minimally or no tax impose in corporate level at all.
On the other hand, it is very important for a company to ensure that links to communication in a company is taken cared of since transmitting vital instructions immediately and timely communication is important for the success of a company. You should also make sure the privacy of your customers is given due importance since off-shoring business can cause privacy issues if they are not foreseen.
It is advisable for one to choose a stable country so that one will not be stigmatized in the future as a function of not choosing the right country. Also, it is wise to opt for an old and reliable country in setting up an international company rather than those that are just recently publicized. Countries where the unhealthy trade practices have forced the local people to resort to bank offshore or maintain bank accounts offshore due to the inherent risks of banking in their own country where the security or political situation is not conducive.
The above-mentioned phenomenon is referred as flight capital. The phenomenon is characterize by capital leaving the country because of certain disadvantages which is the usual cause of offshore banking.
Hence it can be seen that the benefits of maintaining an offshore company will give you a lot of tax benefits but one must be careful of the country that one chooses to start the company in. Being fluent in the native language of the country you choose to invest in is necessary to prevent deceit. Choose your offshore company location with care to reap huge benefits in terms of stability and profitability.
