An offshore company typically refers to a type of business that is incorporated outside the country (or countries) in which its investors reside or outside the country where a parent company has set its headquarters of its main business operations in a specific offshore jurisdiction.

As a general rule, offshore companies are registered in specific juridisctions in order for the investors to benefit from relevant tax deductions or even no taxes at all, which are not applicable in their country of residence or in the country where they have they main business activities. However, an offshore company is not registered only in countries that are seen as tax havens, but also in certain jurisdictions that offer various types of benefits for these types of companies.

Register an offshore company in Singapore

Singapore is a popular business destination for the registration of an offshore company due to the fact that it has a simple taxation system. Provided that certain legal requirements are met, an offshore company in Singapore will be entitled to numerous tax deductions. For example, a non-resident company can obtain tax deductions if the following are met:

  • The company does not perform any banking activities in Singapore;
  • The legal control of the business is outside Singapore;
  • The company does not perform any business activities in this country.

If these requirements are met, the offshore company can benefit from exemptions on the following taxes:

  • Capital gains tax;
  • Withholding tax;
  • Value added tax;
  • Sales tax;
  • Accumulated earnings tax.

Set up an offshore business in Hong Kong

One of the main benefits of setting up an offshore company in Hong Kong refers to the fact that the initial capital requirement is set up at only $1. Although Hong Kong does not fall in the category of tax haven jurisdictions, investors can obtain relevant tax exemptions for certain taxes. For example, the Hong Kong offshore company is exempted from the corporate income tax on the foreing- sourced income. Also, this type of business can be exempted from the payment of capital gains tax, estate duty, value added tax and others.

Open a Cypriot offshore company  

The registration of an offshore company in Cyprus  can be completed in seven days. As a general rule, an offshore company in this country will be registered as a private company limited by shares, under the regulations of the Companies Law. Forming this type of company in Cyprus could be a good move, since this country has an attractive taxation system, one of the lowest at the level of the European Union and this type of business does not require any paid up capital.