Re: Offshore Juristictions & Banking
[QUOTE=ChadKnowsLaw;57471]Incorporate where you do business.
The true cost of incorporating outside of the country you live is rarely beneficial and will only draw additional attention to you if discovered. If you were a tax compliance investigator and discovered a guy has an offshore company, would you think, “Oh yeah, this guy is legit!” Hell no.
You will incur significant additional costs in formation, maintenance, bookkeeping and moving funds. Funds that you use for yourself or otherwise repatriated still is subject to tax so unless you plan to leave that money in an offshore account the tax benefits disappear. The loopholes that worked in the past have been closed but continue to feed bad advice regarding offshore operations.
Retirement funds that will sit in an offshore account may have some attraction as those funds don’t come back into your pocket for years to come and large multi-nationals can legally take advantage of moving operations but you need to be generating revenues in the tens or hundreds of millions of dollars before it makes sense.
I cannot imagine a start-up having any financially sound or legitimate reason to set up an off-shore operation unless you actually live in that offshore location.
Visa requires a resident in the region where you have a merchant account or 3rd party billing. So if you have a Hong Kong corporation, you cannot avail yourself of Visa US or Visa EU for settlement, and I think some surfers see alarm bells when your join page or settlement goes to some odd place.
Don’t take financial advice from poor people and don’t take legal advice from amateurs.[/QUOTE]
Your comments mainly assume that I am suggesting you do something illegal or underhand i.e. without making proper declarations. This is a common misunderstanding that âgoing offshoreâ is somehow illegitimate.
As I said above in my reply to Gaydemon â I am NOT suggesting one registers offshore in secret. New banking rules including The Patriot Act make it almost impossible to carry out any financial activity unseen by the authorities, but that does not negate the fact that legitimately registered offshore entities can save tax (for example sales taxes in the USA and VAT in Europe).
Put it this way; American readers of this forum will be familiar with the many and numerous deductions and allowances that the IRS permit. Itâs just that a company registered offshore has more opportunity to mitigate its taxes (legally).
âVisa requires a resident in the regionâ¦â I am sorry but I donât follow your explanation. Perhaps you could re-write.
âIncur significant costs in formationâ¦.â. Forming or incorporating a company offshore is (almost) as cheap as chips. Check out Ocra.com. They are a legitimate company offering a range of services to companies and individuals who want to register offshore. Some things cost a little more, but the charges are certainly not âsignificantâ. I am not associated with any of these kinds of companies… they are but one example.
Maintenance and bookkeeping… ditto. For example more and more companies offer accounts services âin the cloudâ and because of this the charges are quite reasonable.
Moving Fundsâ¦â¦ Now we are talking. This is true. SWIFT/Wire international transfers can be expensive and tiresome for small offshore enterprises. But I remember reading somewhere that Barclays offered English/Spanish expats free transfer of funds between onshore and offshore accounts. Lets have more discussing from those with some experience of problems/benefits working with onshore and offshore banks.
Who are the best providers, for example?