A company registered in a foreign jurisdiction other than the country of residence is considered an offshore company. It is also an offshore company if the company is incorporated outside the country where your main operations and headquarters reside.
Offshore businesses often engage in offshoring business services or manufacturing. They function very similarly like any other company, but there exist some extra benefits which offshore companies mostly can avail like tax structure, asset protection, confidentiality, etc.
With the advent of globalization and booming entrepreneurship, more and more companies are going abroad looking for suitable opportunities and benefits. Several countries or territories are also offering much in favour of offshore companies to help them in boosting their economies.
Some of the benefits of incorporating companies offshore
An offshore company may get the following varieties of benefit depending on the specific offshore jurisdiction they are registering:
Easy incorporation: Some countries have made their laws so friendly and welcoming towards offshore companies that they allow such an easy and quick incorporation into their jurisdiction. In some cases, it may take only 24-48hrs for the process provided all the required documents for incorporation are kept ready.
No foreign exchange controls: Most of the offshore jurisdictions offer the benefit of no restrictions on foreign exchange.
Offshore jurisdictions have a name for providing high confidentiality to its offshore companies. They kept the information of account holders and their financial transactions private to a varying degree. This keeps the account holders safe from the public eye and unscrupulous litigations and people.
Flexible and favourable corporate legislation:
Many of the offshore jurisdictions often offer a friendly, supportive legal framework that encourages the growth of offshore companies and foreign investment. Such laws also provide a lot of flexibility to offshore companies.
There are offshore jurisdictions where taxes are pretty much non-existent. These are called tax-havens. They charge zero to low corporate taxes on their capital gains, value-added tax, income, and others to offshore companies. Some of the famous tax-havens include the Caribbean, Netherlands, Singapore, Hong-Kong, Switzerland, and others.
Freedom to invest anywhere:
Investors often set up offshore companies to have the freedom to invest anywhere they like whether it be in any economic, financial or business activity.
The world of business is dynamic and ever-changing with the growing fast pace of technology, and human wants. Businesses often need to adapt and thus comes the importance of flexibility in relocating. And many offshore jurisdictions allow offshore companies to do that with the least restrictions and documentations in a short period of time.
Offshore jurisdiction offers to protect your assets legally from creditors, lawsuits or bankruptcy. It allows transferring the ownership of your assets, thus legally shielding your assets from the hands of creditors or civil lawsuits.
Type of business that benefits the most from Incorporating Offshore
It is of no surprise that offshore companies do gain a lot of advantages over onshore companies but not every type of business gains the same advantage.
It really does depend on what your business is, the place you live in and what you expect to achieve by going offshore. Not every jurisdiction offers the same benefits, so it is also important to choose the right jurisdiction for you and your business for which an expert’s advice is suggested.
Companies that benefit a lot by incorporating offshore often involves business and financial activities in:
- Offshore investments and savings
- Stock trading
- Professional service company
- Internet services
- Global based company
- Digital-based company
- International trading
- Ownership of intellectual property
- Holding company
Companies whose target market exist all around the world are best suited for going offshore. Any business that is not dependent upon physical infrastructure is much easier in going offshore. Internet-based companies shine amongst such offshore companies. They have the flexibility to relocate anywhere depending upon the favourable jurisdiction they want to set up in.
In order to take the best advantage of this modern internet era, it is best to set up an offshore company to gain your financial freedom by creating an offshore lifestyle by diversifying your company, accounts and residence.
So, if you are interested in registering your company abroad in a suitable jurisdiction for your business, we at Business setup worldwide can help you choose your right favourable jurisdiction according to your needs and also incorporate your company in the foreign land. Feel free to contact us anytime for more details.