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Offshore Company Formation
Offshore company formation is an important step in diversifying your corporate portfolio. An offshore company has many advantages especially if you do business in a country that is plagued with high taxes, complicated regulations and expensive labor costs. The first and foremost advantage is the ability of hiring talents globally and setting up a labor force that may turn out to be more productive and less costly than your current employees. The offshore labor force can then explore local markets that can only be done well if there is a local presence, due to geographical as well as cultural barriers.
For example, it may come as a surprise but the US is a tax haven for foreign companies and foreign investors! Your company formation should be directly linked to the benefits of offshore banking. The important issues to consider are safety and security of banking, access to your capital, the freedom of capital movement in and out of the banking systems, the availability of various payment options, e.g. on-line credit card processing, and whether you can hold your money in multiple currencies to account for currency fluctuations. A well structured global business would use a multiple banking system, e.g. a Swiss bank for savings, a global bank for day-to-day operations and a US bank for credit card processing. A well structured banking system can also serve as the basis of asset protection, a strategy that accounts for asset value fluctuations, the stability of the financial system, the availability of qualified and responsible financial advisors, and the a sound legal system that is pro business and pro profit rather than pro government and high taxes. One of the chief advantages of having an offshore company is the ability of operating around the clock. While your clients are sleeping, their orders are processed in the different time zone and by the time they wake up, the service is delivered.
When choosing a destination, the following requirements should be kept in mind: free trade, sound legal system, safety (the rule of law), clean government, freedom of speech, solid infrastructure, educated work force and good international business management. Do not let offshore company formation be the privilege of the few, contact us for more details on how easy it is to have your own offshore company.
The second advantage is how the hosting country handles various taxes such as corporate, capital gain as well as personal income taxes. Now, tax advantage does not mean tax evasion; it means structuring the operations of your company to minimize your global taxes. Tax havens such as Belize or Panama, may be frowned upon by many countries, however, it turns out that most offshore destinations can serve as tax havens if the company is structured well.
Last updated: 7/22/2011
