Offshore company is ... Registration rules

Offshorom is called a special economic zone, where a specific type of business can operate. In this zone, companies are completely exempt from taxation. Offshore company is an organization registered in offshore and having its own peculiarities in doing business.

What is "offshore"?

Offshore is called an economic zone where foreign organizations can register and work, applying a special taxation regime (preferential). But these companies, however, should work according to the specially created rules of the state under whose jurisdiction they are located.

The idea of conducting activities in offshore zones originated in the 19th century, borrowing the judicial precedents of Britain. These cases raised questions about the taxation of non-residents of the country. The first step in the implementation of offshore is the city of Campione, located between Italy and Switzerland. This was due to the fact that both countries did not want to establish tax jurisdiction on the specified city.

Offshore companies

Offshore company - this is the best option for owners, in whose countries taxes eats most of the profits. Registration in offshore allows you to vary the cost of imported products. There are many options for doing business for offshore organizations: some of them are generally available, others are known only to a small number of persons.

The opening of an offshore company allows its owner to appear on the international arena. The choice of the zone will depend on the nature of the activity. Offshore companies have no currency restrictions, there is no need to introduce authorized capital.

Rules of opening

The registration of offshore companies is different, based on the territories. The registration rules are established by the leaders (governments) of those countries where the offshore zone is located .

But it is possible to distinguish the basic order of actions at registration of the offshore company. Almost all governments have established a requirement to open an organization through a registering agent who has a license to carry out such activities. It can be both a physical person and a legal entity. Enterprises wishing to register in offshore are required to use certain words in their name (Incorporated, Limited, etc.). And they should receive special permission to include some words in the name (Bank, Trust, etc.).

The minimum amount of the statutory fund is limited by the requirements to the authorized capital.

The company will be registered if there is at least one participant (it can be an individual or a legal entity). All names (names) of shareholders are inscribed in a special register maintained by the state.

Some countries set requirements for the citizenship of the management of an offshore company: at least one of them must be a citizen of the country in which the organization is registered in the offshore zone.

It is relatively easy to open an offshore company. The standard offshore requirements are as follows:

- indicate information about the beneficiary, shareholders;

- provide financial statements, tax returns;

- keep accounting records, but there are no requirements for its provision;

- conduct an audit and provide a conclusion on it.

An offshore company is the use of the principles of the classification of offshore jurisdictions:

- by the level of confidentiality;

- by the level of taxation;

- by the existence of an agreement on the absence of double taxation ;

- on the need to submit annual reports.

Advantages and disadvantages of offshore activities

The activities of offshore companies carry a large number of advantages:

- The work of an offshore company is a simple way to transfer finance abroad;

- large businessmen, having registered an offshore company, save significant amounts on tax deductions;

- offshore companies are either exempt from the delivery of financial statements, or have the opportunity to conduct it in a simplified version;

- there are no duties on imported equipment for opening an office of an offshore company;

- registration of a company in an offshore zone automatically implies the confidentiality of data on its founders.

Despite all the advantages, there are shortcomings in offshore work. Despite the fact that an offshore company is conducting its activities legally established by the country under whose jurisdiction it is located, its verification is carried out with great care. Because of this, an offshore company whose feedback on the work is positive, is not suitable for those who plan to conduct business "in black."

Also, even when doing business according to all rules and laws, officials can blame the organization for bad faith in conducting business. Here we must pay attention to the limitations of the work of offshore companies.

For Russia, the best offshore zone can be called Cyprus. Conditions of accounting for such enterprises:

- all organizations that are open in this zone are obliged to conduct accounting, which will allow studying economic activity;

- on the basis of this accounting, a different kind of reporting takes place.

Documents provided annually:

- the financial report on the company's activities, the audit company's report , the tax declaration;

- a financial report, an auditor's report, an annual report are submitted to the Registration Chamber.

Restrictions

There are several factors that put the work of offshore organizations in a certain framework:

- the main limitation is the impossibility of carrying out activities in the state where such an organization is registered;

- very often the controlling bodies force the owners of organizations to sign agreements under which offshore companies can operate, with virtually no restrictions, but at the same time losing all the advantages of creating this company - the confidentiality of information relating to the owners.

In some jurisdictions, there are restrictions on certain licenses and the conduct of activities on them, for example, for the sale of tobacco and tobacco products, sale of alcoholic beverages, etc. In some areas, there are restrictions on certain financial transactions that, if violated, are imposed on the company Heavy fines.

Russian offshore companies

In Russia, companies return their profits to the state, using offshore practices under the guise of foreign investment. But it is important not to forget that tax benefits are applied only where the company is registered, and only on those revenues that are received outside of it.

Foreign offshore companies have been operating in the territory of the Russian Federation since Soviet times. And the improvement of investment processes increases their number.