By Caitlyn Buchanan, 26.06.17
The terms “offshore account” and “offshore company” have come to be commonly understood as a means of hiding money from authorities. However, the majority of banking and business conducted abroad is legitimate. So-called “offshore” locations offer an easier solution to investing, travelling and living abroad because there is reduced regulation to overcome. Before you invest it is essential to know the requirements and restrictions of your chosen destination.
Euro Company Formations facilitate company formations in more than 50 countries worldwide. Through our dealings, we have learned that some countries are more accommodating of foreign investors when it comes to transacting business and establishing finances. The following list is our top 5 best countries for incorporating an offshore company in terms of regulations, taxes, and residency requirements (in no particular order).
This has been a long-time favourite for international companies looking to benefit from the low-tax regime and excellent telecommunication facilities. The economy in Gibraltar is currently very stable and strong growth for the future is expected. The financial services and technology sectors, in particular, have been experiencing rapid growth in recent years.
There is no VAT, withholding or turnover tax in Gibraltar.
The standard corporation tax rate for Gibraltar sourced income is 10% and there is no tax on investment income, dividends, or capital gains. Companies are taxed on profits for the financial year on income accrued or derived in Gibraltar. Profits of foreign companies are taxed at the same rate as resident companies.
Energy and utility providers pay an additional 10% surcharge resulting in a higher tax rate of 20% (this includes telecommunications, petroleum, water and Sewage companies).
Companies are required to submit a tax return within six months of their accounting year end. Tax can be paid in advance in two instalments, on 28th February and 30th September. Each payment is based on 50% of the previous year’s tax and any remaining balance can be paid on submission of the tax return.
- A company must have a registered office.
- A company must have a resident secretary to file official documents to the government.
- Certain information on the company’s activities needs to be provided to the secretary (registered agent) including copies of bank statements in the name of the company, agreement entered etc.
- Minimum Share capital of £100.
Euro Company Formations can incorporate your company in Gibraltar within 5-7 business days once we have received all pertinent information.
For more information on how to incorporate in Gibraltar please click here.
The Cayman Islands are the world’s top domicile for offshore hedge funds and one of the largest captive insurance centres in the world. As a regulated and tax neutral financial centre, the Cayman Islands are an ideal destination for both private and institutional investors. With more than 200 banks, including branches of major international banks, there are plenty of private and investment banking options. The financial institutions have earned a reputation for being highly professional and friendly to foreign investors.
The Corporate Tax Rate is 0%, there are no corporate, capital gains, income, profit, withholding or other taxes imposed on corporations in the Cayman Islands. There are two principal types of companies suited for offshore operations, which are the ‘Ordinary’ and the ‘Exempt’, both types are limited by shares. We recommend the exempt option for offshore operations that do not carry out business in the Cayman Islands. Confidentiality of Shareholder, Director and the offshore company are protected by law.
The exempt company files a compliance statement (instead of a detailed return) annually. However, there are no taxes in the Cayman Islands.
NOTE: The Cayman Islands Government recently passed new legislation for Limited Liability Companies to create and maintain a Register of Beneficial Ownership. The new legislation came into effect on 30 June 2017.
- Companies must have at least one Director and a Secretary.
- The name and addresses of the Directors and Officers must be notified to the Registrar; this information is kept private.
- The maximum capital pays the minimum registration and annual license fee is US$50,000.00.
Euro Company Formations can incorporate your company in the Cayman Islands within approximately 5 business days once we have received all pertinent information.
For more information on incorporating a company in the Cayman Islands, please Contact Us.
Panama is a safe, stable, and affordable country that uses the U.S. dollar as its currency. One of Panama’s biggest advantages is its position as a global banking haven. There are more than 70 local and international banks offering maximum confidentiality and anonymity.
Foreign business and investors are drawn to Panama because the corporation tax is 0% for activities outside of Panama. As long as the business revenue isn’t sourced from within the country, no tax needs to be paid in Panama. When a corporation is set up properly, it will not be liable for taxes from the revenues that flow through it anywhere else, either. The process is not very complex but we recommend you seek advice from a formation agent or a tax expert.
Corporation fees and costs are competitive and there is no statutory requirement to hold annual general meetings. Attitudinally there is no required paid-in capital.
- Companies are required to have 3 Directors and 1 shareholder.
- RUC is a company’s income tax ID number issued by Panama’s revenue agency (DGI).
- Articles of Incorporation filed with the government’s Public Registry.
Euro Company Formations can incorporate your company in Panama within approximately 5 business days once we have received all pertinent information.
For more information on incorporating a company in Panama please click here.
Belize is an increasingly popular offshore location for investors due to a high level of privacy protection, quick incorporation and inexpensive annual fees. Belize offers a simple and efficient offshore solution with a range of benefits and features, making it a highly desirable location.
Belize is a true tax haven. Offshore incorporations in Belize are exempt from all local tax including stamp duty, capital gains tax, dividend and income taxes. They are also exempted from paying taxes upon the transfer of assets, both corporate and financial. Company’s and owners can hold assets and trade anywhere in the world but cannot trade in or own property in Belize itself.
Additionally, Belize has double taxation agreements with the United Kingdom, Austria, and the countries of the Caribbean Community (CARICOM). Tax information agreements have been signed with Mexico, Poland and South Africa.
There is no requirement of a minimum paid up capital, no control on foreign exchange and the annual costs to maintain a company are very low as there is no requirement to file tax returns with the Belize tax authority. To keep the incorporation and annual costs to a minimum the standard authorised capital of 50,000 USD is recommended; divided into 50,000 registered shares of 1.00 USD.
Any individual or legal entity (corporation or LLC), regardless of residency can be appointed as the director or officer of a Belize offshore company. Information about corporate directors, officers, shareholders and beneficial owners is not filed with the Belize Registry or available to the public.
NOTE: From October 2013, all international business companies are required to maintain accounting records as part of the Accounting Records (Maintenance) Act. The location for the keeping of these records may be determined by the Board of Directors.
- Companies are required to have at least 1 Director (no restriction on Nationality). A director can also either be an individual or a corporation.
- A minimum of one shareholder is required. Just one share for US$1.00 could be issued to that shareholder.
- Registered office is required but the principal office address (business address) may be in any country.
- Companies must have a local registered agent authorised by the Belize government.
Euro Company Formations can incorporate your company in Belize within 1 business day days once we have received all pertinent information.
For more information on incorporating a company in Belize please click here.
Mauritius is a premier international business centre located in the Indian Ocean. Over the past 20 years, Mauritius has seen exponential growth and socio-economic development, emerging as a politically stable democracy. Mauritius has become a credible jurisdiction for offshore company formation, welcoming foreign investors and businesses alike. It offers reliability and security to investors through a flexible regulatory framework.
There is no Capital Gains Tax and the tax rate applicable to all companies is 15% on profit consisting of business/trading profits and passive income. An offshore company (GBC1) is entitled to a deemed foreign tax credit of 80% of the tax payable. A substantial advantage of setting up a GBC1 is that it may be structured as tax resident in Mauritius. Resident companies are exempted from Dividend taxes and they are eligible for Mauritius’ taxation treaties with 28 countries.
A company incorporated in Mauritius can be 100% foreign owned and no minimum capital needs to be paid.
- Companies are required to have at least 1 Director, (no restriction on Nationality). However, to take advantage of tax treaties, 2 resident directors must be appointed.
- A minimum of one shareholder is required, can also either be an individual or a corporation but must be non-resident.
- Audited accounts to be submitted. Local accountant must be appointed (not prior to incorporation)
- Companies must file tax returns and pay any income tax not later than six months from the end of the month in which the accounting period ends.
- Must have a local bank account
- Annual License fee
Euro Company Formations can incorporate your company in Mauritius within 2 weeks once we have received all pertinent information.
For more information on incorporating an offshore company in any of the locations covered in this article please contact our team today.Contact US