ABOUT
Offshore is a word with English roots. Translated, it means "offshore." Offshore is a special financial center that attracts foreign capital of companies registered in the country of its location. Such zones are quite common in the world. One of the advantages of these territories is special taxation. Offshore is a center where preferential terms for entrepreneurial activity are provided.
Historical reference
The concept of offshore first appeared in one of the publications of the newspaper on the east coast of America in the 50s of the 20th century. It spoke of a special financial structure that was able to avoid state control through geographic selectivity. In simple terms, the enterprise transferred its activities, which the US authorities sought to regulate, into a zone with more favorable tax conditions. In this regard, the term in question includes both the legal and economic-geographical aspects. Offshore is not a modern phenomenon. It was used back in ancient Athens. At that time, two percent export and import taxes were introduced. In order not to pay them, the Phoenician and Greek merchants began to go round the Athenian territories.
The tax havens soon began to appear small islands located nearby. They smuggled goods without duties. Flanders had fairly low taxes and trade restrictions in the 15th century. Therefore, it was more profitable for merchants from England to import and sell wool there, rather than at home, where there were more severe conditions. In the USA, offshore business has spread since the 18th century. In order not to pay import duties that took place in England, merchants tried to trade through Latin America.
Switzerland became the country where companies began to attract earnings on money transfers to offshore. Against this background, exchange centers and institutions for secrecy of capital were formed. At the legislative level, a requirement was introduced to keep records of customer accounts and a simultaneous ban on data disclosure. In the 70s of the last century, some island English colonies gained independence. Those remaining under the control of the United Kingdom lost subsidies from the state budget. They switched to the independent creation of their capital. To create their own budget they were allowed to register offshore. In recent years, other countries have begun to adopt laws similar to Swiss. As a result, there was competition in attracting international capital. For many
island countries that do not have natural development tools, offshore is the only way to earn income.
Island territories
These small areas are located in the Caribbean, Indian and Pacific Oceans. Their main feature should be noted the absolute absence of taxes, low requirements for accounting, moderate fixed deductions, as well as a high level of anonymity and confidentiality of business owners. But in most cases, companies that are registered in island offshore companies have low positions in the ranking and a dubious reputation.
Other areas
Higher rated European territories. The maintenance of the offshore zone can reach several tens of thousands of US dollars per year. In these countries, benefits are applied to certain types of activities. Therefore, such territories cannot be called offshore in the classical sense, since taxes are paid here, audits are carried out regularly, and reports are kept. Moreover, information about the owners of enterprises is disclosed in a general manner.
Cyprus offshore
It is an international financial and business center. This area is well known among entrepreneurs and large firms. Most of all investments in the domestic economy go through Cyprus. Among the advantages of creating a company on the island is the relatively low cost of registration, annual maintenance and annual (zero) balance. In addition, Cyprus has signed special agreements with almost all states. These contracts avoid double taxation. Another important feature is the ability to use a nominal service. It allows the real owner (beneficiary) to remain anonymous in transactions and legal actions of a minor nature.
Companies
An offshore company is an enterprise that is registered in an area where special benefits are provided. Companies of this type have the right to carry out their activities not only abroad, but also within their own country. Small states encourage the formation of offshore companies. So they develop this sector of the economy, which brings additional profit.
goal
The main motivation for the formation of offshore companies is tax optimization. With competent structuring of the company, other advantages can be achieved. For example, provide:
- Property protection.
- Confidentiality and anonymity.
- Cost optimization.
- Lightweight reporting requirements.
Optimization of tax deductions is carried out not only by domestic, but also by many foreign companies. Among them are such giants as Microsoft, General Motors, Google and others.
The main characteristics of firms
Offshore companies have the following features:
- They are non-resident with respect to the country in which they are registered. This means that the administrative apparatus of the enterprise is located abroad.
- Companies are usually exempted from the main tax amount, or its value is relatively low. As a relief, they may be asked to pay a small annual fee.
- Simplified registration and administration procedure. Nominee managers and owners may participate in the management. Moreover, the requirements for holding general meetings and boards of directors are formal.
- There is no or significantly facilitated currency control. At the same time, the requirements for financial statements are minimal, and there is no need for audits (with a few exceptions).
- Anonymity of ownership with a high guarantee of confidentiality. This principle is based on generally accepted legal norms and legislation of the jurisdiction in which the company is registered. At the same time, it is currently impossible to draw up documents for a company without disclosing data on the ultimate beneficiary. Information about him is necessary in order to ensure the safety of the ratings.
Enterprise Creation
To open a company, you should visit an offshore jurisdiction or contact the appropriate company that specializes in this area of activity. At the beginning of 2013, there were more than 100 such organizations in the Russian Federation. Firms involved in the opening of offshore companies offer:
- Registration of an enterprise, including obtaining a seal, certificates, a necessary package of documents.
- Sale of ready-made companies that were previously created, but were not used by anyone. In this case, a long existence in the market will significantly increase the reputation.
- Preparation of documentation and opening bank accounts.
- Comprehensive support in legal matters.
- Help in choosing the most suitable territory.
- Provision of nominee managers and shareholders.
- Courier delivery of mail, forwarding received correspondence.
In addition, telephone numbers and secretarial services can be provided.