Offshore Tax Havens
Offshore tax havens also commonly referred to as offshore jurisdictions are countries which have tax systems which individuals and corporations can take advantage of to pay low taxes and in many cases no taxes at all. Offshore jurisdictions are countries which have enacted offshore laws which will enable them to provide offshore services such as offshore banking and banking services, offshore company registration, the registration of offshore trusts and offshore foundations, offshore captive insurance and registration of offshore LLCs (Limited Liability Companies) among other offshore services. The term ‘offshore’ cannot be applied to all tax havens since whilst some of these countries may have low tax regimes they may not have offshore legislation.
Some of the most popular offshore tax havens are Dominica, Anguilla, Nevis, St Kitts, Belize, Bahamas, Cayman Islands, Seychelles, Panama, and British Virgin Islands (BVI). Other tax havens include Barbados, Gibraltar, Hong Kong and Singapore. Tax havens are called pure of zero tax havens and those jurisdictions as their name suggests have no local taxes applied to the earnings of offshore companies and other offshore entities earned abroad. The low tax havens levy taxes at low rates on the worldwide earnings of offshore entities.
The majority of offshore tax havens offshore banking services to offshore companies, other offshore entities and individuals. Offshore banking legislation is known to provide an environment for tax free banking which is protected by banking privacy laws. Offshore banking in the offshore tax havens was built on offshore banking privacy laws. Corporate offshore bank accounts and personal offshore accounts benefit from banking services such as multi currency accounts, remote access to offshore accounts (online banking and banking via telephone), credit and debit cards, wire transfers, chequing accounts, loans, offshore investments opportunities and more.
Offshore corporation creation, same as Panama company incorporation, in the offshore tax havens is the most popular offshore service, most offshore jurisdictions do not allow local business operations but offshore companies pay no local taxes in the zero tax havens. Offshore enterprise construction, comparable to Seychelles company formation, is carried out by local offshore registered agents and the beneficial owner of the offshore company or any other offshore entity has no need to visit the offshore tax haven of choice. Offshore companies have very flexible structures with just one company director and one shareholder needed for offshore company registration. The same person can be the director and shareholder.
Offshore tax havens are the best destination for asset protection. Offshore legislation in the tax havens makes it possible for offshore entities to provide asset protection against third parties (creditors) civil cases and forced heirship. The offshore trust is one of the offshore entities which provide the highest degree of asset protection in offshore tax havens. Entities can be used alone but a combination provides stronger asset protection.
Offshore tax havens provide offshore services at affordable and that added to the overall tax savings gained from proper structuring of offshore entities makes the tax havens perfect for making investments. The tax savings made from offshore investments are much greater that the registration and annual maintenance fees paid. Choosing the right offshore tax haven is very important when considering going offshore. The best offshore tax havens are those with modern legislation which is strictly enforced and has no taxation on foreign earned incomes.