Looking to establish a company away from your home jurisdiction? The choice among which offshore jurisdiction to incorporate an entity can be complicated. Each International Business Center (IBC) carries its own set of advantages, benefits and possible trade off.
We have had personal experiences dealing with our competitors previously. Telephone and email enquiries either remained unanswered, or we were dealt with by rude or inexperienced staff that can barely communicate. The fact is, they had no idea, nor did they care about what our business needs or queries were as they eagerly awaited for the clock to hit 6pm.
With this very frustrating first-hand experience, we thought to ourselves “there’s got to be better service providers than this“. With the market inundated by sub-standard service and quality, Thomas. Jefferson Associates (TJA) took matters into our own hands. Don’t believe us? Contact any of our competitors and then compare your experience with our service level.
Our difference? We listen. Your enquiries are not handled by an inexperienced and staff on minimum wage, armed with a checklist and can barely communicate. In designing an offshore company structure and the tax planning process, a TJA specialist Consultant will start by reviewing your business and residency situation, as well as your banking and strategic needs before recommending the best jurisdiction for your offshore company set-up.
Choice of IBCs
We have illustrated a simple breakdown in accordance with your purpose of setting up an offshore company:
- Simplicity, ease of administration and privacy: Seychelles or BVI
- Asset protection: Cyprus
- Operating a business, create a hybrid corporate / foundation model: Panama
- Doing business in Asia: Hong Kong or Singapore.
- Financial services or Forex licensed entity: Cyprus (for an EU license)
- Investing in hedge fund, require maximum transparency and regulatory agencies: Cayman Islands
British Virgin Island
The British Virgin Island (BVI) remains the world’s leading offshore centre for the incorporation of international business companies, with approximately 450,000 active companies currently registered in the Territory.
One of the key strengths of the BVI which explains its continued success in an increasingly crowded market for offshore incorporation is that it is considered to be a responsible, respected financial centre.
The attractiveness of the BVI for providing prompt, cost effective and flexible option to incorporate Special Purpose Vehicles (SPVs) and other entities (particularly funds), has been embraced across the world, with many now referring to an offshore international business company as simply a “BVI”.
Cayman offers a well-regulated and internationally respected, tax-neutral, offshore business environment. Cayman Islands is popular for large fund formations and investments and is the largest centre for hedge funds in the world.
In the past, the Cayman Islands were the original offshore jurisdiction. Now, a Cayman offshore corporation is popular with large fund formations and investments, individuals seeking entry to the most compliant banks and is the jurisdiction of choice for large offshore structures.
The Cayman Islands is the largest offshore banking centre with approximately 200 licensed banks.
If you are looking for an EU nation with easy to establish and low cost to maintain a company, Cyprus is an ideal location to meet and exceed your needs.
The Cyprus entrepreneurial environment and supportive facilities compare favourably with those of the best-established IBCs in the world. The island is considered to be a primary offshore and IBC among approximately 50 countries offering facilities for these purposes.
Cyprus is a leading financial centre with one of the lowest tax rates among EU nations, enjoying an extensive network of double tax treaty, offering excellent professional services and a transparent regulatory environment and a great place to live.
Its tax and legal systems are in full compliance with the EU and the OECD’s requirements, thus resulting in Cyprus being included in the white list of international cooperative jurisdictions. Cyprus is a competitive business centre since is offering excellent professional services and is a highly reputable financial centre due to its status as a member of the EU.
Hong Kong SAR
Hong Kong has a favourable taxation regime, which means that correctly structured and managed Hong Kong companies can be used for international trade without paying any taxes in Hong Kong, provided the company does not have Hong Kong source income.
Hong Kong imposes no withholding tax, sales, tax, capital gains tax, net worth tax, or VAT and there is no tax on investment income or capital gains. Hong Kong has long been the door to mainland China, and serves as an ideal place if you are looking to do business in China.
A popular emerging offshore IBC is the Seychelles. The Seychelles IBC is a flexible tax free company ideal for a wide variety of uses. Seychelles IBCs are commonly used as Holding Company (real estate, shares, equities) or consultancy and personal service company.
Confidentiality is one of the key features of a Seychelles IBC. The reason for this is due to the fact that the details of the Seychelles IBC’s beneficial owners, directors and shareholders are not part of the public record. This information is only kept at the offices of the Registered Agent in complete confidence.
A Seychelles IBC is an efficient entity for opening bank accounts at an EU banking institution.
Singapore has established a thriving financial centre of international repute, serving not only its domestic economy, but also the wider Asia Pacific region. Singapore’s financial centre offers a broad range of financial services including banking, insurance, investment banking and treasury services. Singapore has evolved into one of the world’s premier banking centres.
Singapore is becoming increasingly important as one of the world’s lowest tax havens and is keen to attract foreign investment. It serves as an excellent choice for offshore company formation if you are looking to dispose of assets because of the non existence of capital gains tax. In addition, Singapore does not levy a withholding tax on dividends. Interest and royalties paid to non-residents are, however, subject to a 10% or 15% withholding tax.
On the downside, annual costs for maintaining a company in Singapore are significantly higher in comparison with other offshore jurisdictions.
Thomas. Jefferson Associates
For all your offshore corporate formation, maintenance and ongoing compliance needs, contact TJA for specialized and tailored advice. We can assist you in every step of the way. That is how we stand out from our competitors in this field. Contact us today for an obligation free consultation.
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T: (+852) 6094 9452
THOMAS. JEFFERSON ASSOCIATES LIMITED
Suite 2302, 23/F New World Tower 1
18 Queen’s Road Central
Hong Kong SAR