Offshore - the ideal solution for Internet companies
Companies that decided to open an offshore for internet business were able to legally reduce their tax burden dozens of times. This allowed not only to save money, but also to continue investing it and develop the business. In addition, offshore jurisdictions are reliable and ensure the privacy of clients, allowing them to remain in the shadows, as well as provide an opportunity to protect assets from third parties.
Features of offshore jurisdictions
An offshore company is founded abroad in a jurisdiction with low taxes. Such countries are focused on attracting investment, so they provide foreigners with benefits (including full exemption from some taxes) on the condition that they will work outside the jurisdiction.
Not only countries which are blacklisted in the EU but also quite serious and trustworthy jurisdictions (Singapore, Switzerland, Luxembourg) are considered to be offshore. Each country has its own peculiarities, that must be clarified prior to the registration. You need to find out if the jurisdiction has signed a treaty with your country on no double taxation. In this case, there will be no problems with the tax authorities at the place of registration.
Many jurisdictions allow you to open a company as well as a bank account remotely or by power of attorney through intermediaries. By choosing a country with good online banking, business can be conducted remotely, with only occasional visits to the country of registration.
Advantages of offshore for an internet business:
- Financial privacy and security;
- Flexible legal requirements for paperwork;
- Strong asset protection;
- Possibility to work in several jurisdictions: to make payments in one country, to promote a site in another, to pay taxes in the third.
What you should know about choosing an offshore jurisdiction
Before starting a business in an offshore jurisdiction, you need to make sure it suits your company and pay attention to the following nuances:
- How many directors and employees should work at the company;
- Should there be a local employee and what positions they should hold;
- The amount of authorized capital;
- The ease of opening a bank account;
- Is it necessary to have a physical office or can be limited to a virtual one;
- Whether personal presence at registration is required;
- The quality and speed of the Internet - a very important criterion for the Internet business.
If you have high requirements for the safety of assets, you should find out whether the jurisdiction meets them. For example, the assets of a company registered in the Cook Islands are not available to creditors, and foreign court orders are invalid. It is possible to file a claim in a local court, but the process is long, expensive, and time is limited to 2 years from the date of the event.
Taxes and offshore: what you need to know
Lack of taxes is not always a good thing. Many jurisdictions that provide the opportunity not to pay them at all, do not enjoy the trust of banks, which may prevent online business. First of all, this applies to the countries that are blacklisted by the EU:
- American Samoa;
- Virgin Islands;
- Trinidad and Tobago.
The higher the tax rate in the country, the more reliable international banks see it and the easier it is to trade. Inexpensive tax jurisdictions include Singapore, Hong Kong, Luxembourg, Switzerland, Cyprus, Malta, Latvia. Registering a company in countries with preferential taxation will open up access to world-class banking services, various financial opportunities.
How to start an internet business in offshore
- Determine the goals and reasons why you want to go offshore. They will help you choose a jurisdiction;
- Make a business plan, decide on the type of company (legal entity);
- Gather the necessary documents, pay the fees and file for registration;
- After registration, open a bank account through which transactions will take place;
- The next step is to prepare an offshore payment gateway, through which transactions will take place.
Where to register a company for internet business
If you need to register an offshore company for an internet business, call IT-OFFSHORE experts and we will help you.