An offshore company is a business organization registered in a certain country but business activities are conducted outside the country. This is mostly used for beneficial tax purposes where companies incorporate their activities offshore so that they have to pay less tax. Most people see this as illegal which is used by drug dealers, smugglers etc. However, this ideology is wrong. There are many legal ways to build an offshore company. Here are some factors to consider when starting an offshore business.
1. Reason to start
Building your company in a tax haven is the main reason of offshore company incorporation. If you feel that you country is not supportive of businesses and they are imposing too much tax while implementing too many rules and regulations for businesses, then you sure deserve better. Offshoring can be a great opportunity for you to move your business to a country which gives due respect and even low taxes. Other than this, companies offshore to protect their assets from litigations that could take place and also to protect their companies from economic instability and political issues.
2. Business type
There are five basic types of companies that could be started up as offshore companies. They are namely, International Business Company, private Limited Company, Limited Liability Company, Global Business Company and SARL. Each type has its own pros and cons so make sure you choose the best type for your business. Also the ideal businesses for offshoring is e-commerce and web based businesses, international businesses, wills and inheritance, intellectual property rights, counselors, consultants etc. if your business is one of the above or similar, you should seriously consider offshore company incorporation.
The country you want to incorporate in depends on your goals. If your company is a manufacturer and can operate alone, zero rated tax countries are ideal. However if your company deals with more external affairs as banking, merchant services etc, you must consider moving to Asia as Hong Kong or Singapore, where you can get all these services and pay very low taxes. Common offshore zones are Nevis, Seychelles, Mauritius and even Gambia. In Europe, Malta, Ireland will offer very low rates while Estonia gives zero rate taxes. Even Dubai and Bahrain are coming up as offshore hubs.
4. Tax implications
The whole point of offshoring is to reduce your tax burden. However the most important thing to remember is that we are there to reduce our tax, not hide or evade from taxes. When you set up you offshore business, make sure you take a tax team with you so that no complications will arise. Each offshore jurisdiction will have different laws regarding tax filing and keeping records. Know all these before you move there and make sure your tax team is doing the necessary filing on time.
Consider these few points before you set up an offshore company. It will make the process much easier and hassle-free. After these considerations all you have to do is find the best offshore company provider, do all the paperwork, know the rules and regulations, get the approval and you are good to go. Click this link http://www.exes.com.sg/cowork-office/ for more information about coworking space in Singapore.