Benefits of Forming an Offshore Company
There are several important advantages behind why a business or individual might choose to establish themselves in a different country than the one they primarily do business. Incorporation offshore are attractive for those who seek lowered tax burdens, asset protection, better confidentiality and privacy, reduced bureaucracy and more political stability.
However, going offshore also has several complications. Deciding under whose jurisdiction to place your business is the most important concern, and some nations are known for being much more welcoming to outside businesses than others.
Forming an offshore company provides you with these benefits:
Privacy and Legal Protection
A limited liability company or trust formed offshore protects you from frivolous lawsuits and harassment. Privacy is the first shield. The second, by titling assets away from being tapped in case of an adverse judgment in a lawsuit, is strong disincentive in itself from speculative litigation. It’s also an ideal way to avoid unwanted publicity from holding wealth.
Some countries require that those who wish to serve a lawsuit onto a company in their jurisdiction should first post a bond of up $25,000. If the lawsuit is examined and declared frivolous, this bond will not be returned.
An offshore company reduces disruption of your business activities, insulates the affairs of the company from your personal and other industry concerns, and strongly enforces your right to privacy.
Perhaps the most important quality people look for in establishing an offshore company, and why the most favored nations are known as tax havens.
For example: an International Trading Company based in Malta is liable for only 4.7% tax rate, and additional double taxation treaties that Malta has signed with other nations.
Transactions carried out by offshore companies are levied less in transfer fees. Property purchases and transfers also avoid much of capital gains and inheritance taxes.
As mentioned before, assets protected by being titled offshore cannot easily be taken away by court decisions happening in another country, misappropriation, settlements, fraudulent claims, or bankruptcy. Protected assets can often mean the difference between the total collapse of a business after a lawsuit or a smoother road to recovery.
Offshore company can also be the choice for businesses who want to run lean and mean. Companies can be established much faster than typical onshore businesses, and require as few as one or two minimum shareholders and one director/manager. Disclosure of the primary beneficiary is optional.
Capital requirements are lower, the incorporation process much faster. Offshore companies typically benefit from reduced physical employment costs and maintenance. Furthermore, in the case of investing and shipping, these companies typically operate much closer to their markets and are more responsive.
This is a benefit that can’t be overestimated. Establishing your company on much more stable country without corruption and intrusive legislation opens you to a wealth of possibilities and protects you from political unrest impacting the way you do business.
Look establish offshore in places that have policies of transparency, sound economic outlooks, strong democracies, and stringent anti-money laundering/anti-terrorism funding laws. International transactions conducted through these nations are highly trustworthy and often expedited.
It is time to dispel the myth that having an offshore company is all about illicit dealings, money laundering, or trying to escape social responsibility.
It is, in fact, one of the best ways of improving efficiency at home and protecting shareholders from fraud, corruption, and market crashes. Nor is it solely the province of business giants. Professionals, creators, investors, and web-based businesses actually benefit most of all from the ease and unexpectedly low costs of establishing an offshore company.
Among these countries that provide quick and easy offshore company formation is Malta, which has long served as a gateway for investment into or out of Europe. If you would rather not establish a company offshore for operations within your host country, creating a Malta company is also one of the best ways of opening steady business with the European Union.
Learn more about how simple and fiscally prudent it is to establish an offshore company from experienced Malta lawyers.