First and foremost an offshore company is a flexible business instrument that can be integrated into a wide variety of tax planning and asset protection arrangements. Reduced or deferred tax liability and increased confidentiality are just two of the benefits which can be achieved by an offshore company.
Much of this, of course, will depend on the anti-avoidance tax laws that may be in force in the country where the beneficial owner is citizen, domiciled or does business.
Offshore companies use shares to reflect their ownership. Buying or taking a share simply means a person investing money, assets or intellectual rights or property into the company. Having done this he gains the right to participate in the profits of the company in proportion to his share.
Matthew Fretten, Head of our Commercial Team, says “The process of setting up an offshore company can be daunting. Key elements are researching the benefits that offshore companies can offer and taking advice on the process involved in setting up a company overseas and the legislation applicable to each individual jurisdiction.”
Tax benefits are usually a major consideration for businesses or individuals wishing to set up an offshore company. Once an offshore company is formed this constitutes a transfer of assets by the individual.
Authorities in the UK will consider certain classifications for what a transfer of assets will involve. This will include transferring cash to a non-resident trust or subscription by an individual for the share capital of an offshore company. Where an individual transfers assets such as shares or property to a new or existing non-resident trust, or other person or company abroad, this will also be included.
Please get in touch if you need more information on this topic. For a free initial meeting please call 01202 499255 and Matthew or a member of the Commercial Team will be happy to discuss any questions you may have.