Tax Planning – Offshore Tax
A Marshall Islands Company formation may be used to legitimately minimize tax by properly structuring financial and business affairs.
A person working overseas may be able to limit his tax burden by receiving, into the country in which he is working, a fixed level of remuneration and accumulate the balance in an offshore company. Similarly, designers, authors, consultants and entertainers may assign or contract with an offshore company the right to receive fees due under a contract for services.
People who travel the world and expatriates often find that their connections with foreign countries create uncertainties and undesirable consequences for their wealth on their death.
The transfer of wealth to an offshore company (again, there are no MI trusts) can avoid these difficulties, the wealth is protected in a stable environment well away from the unwanted attentions of the tax and inheritance laws of foreign jurisdictions.
Where a person is domiciled outside a territory and owns assets located in that territory (e.g., property), then such assets may be protected against inheritance tax and higher rates of taxation by holding the assets through an offshore investment company.
Confidentiality Offshore Companies can offer you complete privacy. If the company shares are held by a Trust, the ownership is legally vested in the trustee, thus gaining the potential for even greater tax planning advantages.
You can set up Family and Protective Trusts (possibly as an alternative to a Will) with an offshore company for accumulation of investment income and long-term benefits for beneficiaries without high income, inheritance or capital gains taxes.
Conduct Business with Low or No Corporate Taxes
Certain countries such as Marshall Islands allow the formation of international companies with no tax or reporting responsibilities. This means you save money not only from zero corporate tax, but also from reduced compliance and other regulatory costs. Asset Protection
High net worth individuals gain privacy and save on professional fees by using offshore companies as Personal Holding Companies. These entities may be suitable for inheritance planning and reducing the costs and time delays in probate.
You can protect your assets by setting up an offshore company in combination with a Trust. Choosing the right country to incorporate an offshore company can help you avoid unnecessary and high taxes that would otherwise be payable if the assets were held directly. It can also help protect assets from creditors, adverse claimants and other parties; or help you secure against future claims such as bankruptcy, judgment creditors and other litigants.
The offshore company is investing in property, stocks and shares, commodities and other assets, while providing anonymity and tax savings. Funds accumulated can be invested or deposited throughout the world, although the funds may be subject to the tax regimes of the countries in which the investments are located. There are countries with tax free bonds or bank deposits where interest is paid gross.
Shipping Companies Ships or yachts may be owned by an offshore company and registered in an offshore jurisdiction which can prove cheaper and more tax efficient method of ownership.
Simplification of Transfer of Properties Held in Several Countries: If you own properties in several different countries, you will understand that the sale or probate of properties can get complex and expensive. If an offshore company collectively holds these properties title, the ownership can be transferred by company shares rather than transferring the actual properties.
Many of the difficulties and expenses associated with investment in overseas property, such as holiday villas, may be avoided through the use of an offshore company to hold the title of the property. Sales of the property at a future date can be dealt with quickly and easily by the sale of the company shares to the purchaser. This also saves legal fees and overseas transfer and value added taxes levied by certain foreign countries.
It can also be used to successfully avoid capital gains and inheritance taxes.
Payroll costs and travel expenses may be reduced by paying employees working overseas from your offshore base. This may also provide tax relief and social security saving benefits for the employees.
IPO and Capital Raising
Many large corporations in economically and politically uncertain countries often diminish the perception of risk by moving ownership of assets and the base of their operations offshore.
Single Purpose Trustee
Where the client creates his/her corporate trustee for a family trust, it ensures more effective control during the client’s lifetime and savings on third party trustee fees. A Marshall Islands company can serve as the corporate trustee of a trust formed in another jurisdiction.