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What is offshore banking?

Most of you heard about him, but maybe you did not think how easy it was to do business in a tax haven. Just know basic information. The most famous tax havens include the Virgin Islands, Cyprus, Liechtenstein, Bahamas, Seychelles, and others. In some of these areas, even the number of established companies exceeds the number of local residents. The tax haven is also spoken as an offshore center (“offshore”). But how did a fairy tale of the promised land of all entrepreneurs arise? The roots of the tax haven go back a long way when the states near the UK and the US wanted to get foreign capital, and therefore offered substantial tax relief to foreign investors. If you think you need to move to the Bahamas or a similar distant island state, you are mistaken. Business in a tax haven means, that you are doing business in one country while your property is in another country. The authorities of the first country do not pay tax on your business. You are doing tax-exempt foreign companies.

What are the benefits of offshore banking?

tax havens
  • Absolute confidentiality of information
  • Low or zero income tax
  • There are no inheritance or gift taxes
  • Security of inflation protection
  • Minimum legal obligations
  • Significant reduction in operating costs
  • There is no restriction on the use of foreign exchange resources
  • Information about company owners is not publicly available
  • Simple access to North American and European capital markets
  • You are not limited in international trade
  • You do not have to give tax returns
  • No bureaucracy

Where did the taxes come from?

taxes

Taxes have been in various forms since time immemorial. We pay them, our parents, grandparents, and grandparents paid for them … Taxes are as old as humanity itself. But somehow it had to start … Taxes came from the burns that the farmers paid to the armed groups for protection. Over time, as the state was shaping up, more and more of the activities for which they had to surrender taxes had increased. If there was a frequent increase in taxes, it was mostly due to the war. Today’s high taxes not only here, but throughout Europe, are the result of the First and Second World Wars.

Start your own offshore company

Start your own offshore company

Anyone can set up an offshore company, but we would like to clarify why the foundation of this company is helpful. Any company that has an annual turnover of more than one million Czech Crowns will not be robbed by taking advantage of the opportunities offered by tax havens. Business in these areas is often mistakenly linked to illegal activities. However, if you obey the prescribed rules, you do not have to worry, your business will be completely legal in the Bahamas and you will save significantly. We recommend using the services of professional companies that will provide all the necessary formalities for establishing an offshore business. It will naturally happen to you, but you will be sure that everything is in perfect order. Profit will definitely exceed the costs you put into this one.

What is the foundation of such a company in practice? Enter the name of the company and the decision on the amount of the capital. Typically, this asset is around $ 500. You do not have to repay the amount. You then specify bearer shares or name. If you choose to name shares, you need to provide shareholder information. If you prefer full anonymity, then choose actions on the guarantor, where you do not have to provide any information. The obligations to be met when registering a company are provided by a local registered agent. When the company is registered, the necessary documents will be sent to you as the owner. Additionally, you need to set up an office company office, which can help you with your local business center. You can open a bank account at your headquarters, which you control via fax or phone from our country. All in total anonymity. You do not have to go through unpleasant acts that are connected with the establishment of a business in our country. This avoids, for example, VAT registration, accounting, audits, income tax rates at a percentage rate, and other less-favored domestic business obligations. You only tax your income by paying acceptable flat rates. Orders you have in your home business then billing through a foreign company. You can continue to invest in your country and pay it for example in the form of dividends. then invoice through a foreign company. You can continue to invest in your country and pay it for example in the form of dividends. then invoice through a foreign company. You can continue to invest in your country and pay it for example in the form of dividends.

The second alternative is to use a non-interest-bearing loan to your own company in your native country. But be careful when you transfer money to a personal account, you must tax them! If the whole process seems to be complicated, believe that its fulfillment is a matter of very short time. Specialized companies are trained on this, and everything is just a matter of routine. The cost of setting up a company in one of the tax havens is already around $ 1000, and approximately the same amount will be charged for annual administrative operations.

Who do you care?

Some people do not share the enthusiasm of using tax havens. These include, for example, politicians in Germany. There is now a scandal with several wealthy Germans, who have been able to carry out tax evasion through Liechtenstein for several years. According to preliminary estimates, Germans cheated their state up to several hundred million dollars. Klaus Zumwinkel, who held a leading position at Deutsche Post, also resigned for this scandal. The scandal even touched the princely families.

Germany has therefore decided to push the EU to change and tighten up the conditions in a European directive addressing tax havens. European Union officials are convinced that tax havens with anonymous accounts will not be able to fight money laundering effectively, and entrepreneurs will continue to have the opportunity to impose tax-free income outside the control of tax authorities.

You will not be the first or last …

If you decide to do business in a tax haven, believe that a similar decision in the Czech Republic is no news. Companies that work under the auspices of the company from the tax haven grow in our country every year. Only this year is a fifth more than in 2007. At present, there are 8130 companies that officially own companies from the areas of tax havens.

Company founded abroad: The smallest tax haven: Andorra

Andorra, a principality and small state at the same time, is located in the eastern Pyrenees between Spain and France. In terms of area, it is the largest of the six European dwarf states. Andorra is the only country in the world where there is a dual rule. The function of the head of state is exercised by the bishop of Urgell and the president of France. The tourism industry plays a major role as the most important economic sector.

The population is relatively low and is kept low by low-yielding agriculture. In Andorra, in the year 1950, there were 6,176 people, but in the following decades, Andorra experienced a strong population increase. Today, the population is about 76,000 people. Population growth is mainly due to immigration, especially from Spain, Portugal, and France.

economy

The dwarf state, apart from water, has virtually no natural resources, as only 2% of Andorra’s uncultivated land can be used for agricultural purposes. There is very little industry. The country lives mainly from the tourism industry. An additional significant source of revenue is the sale of electricity generated by hydropower. Andorra’s banking industry is well developed. Andorra grants its citizens extensive tax exemption. Andorra is the only country in the world that completely lacks a tax office.

Outlook as a branch office

Geographically, Andorra is on the same latitude as Rome, which means you can expect almost 300 sunny days a year. However, Andorra offers foreign companies not only pleasant climatic conditions but also tax benefits and subsidies. Another incentive is the political stability of the dwarf state and personal security.