Frequently Asked Questions

In order to help you, the visitor, find your answers quickly, we provide a list of Frequently Asked Questions. Here you can find quick answers about what we do, and other common questions.

Offshore Company FAQs

What Is an Offshore Corporation?

A corporation is an entity recognized by law as a separate 'person' with limited liability. A corporation has the option to sell shares, the right to sue and be sued, and has perpetual existence.

How Are Offshore Corporations Used?

Offshore corporations may be used to own and operate businesses, issue shares, bonds or otherwise raise capital, guarantee obligations, hire employees, buy goods and services, sell goods and services, make contracts, rent office space, maintain checking and saving accounts, and maintain retirement plans for employees. Although most offshore corporations are private and closely held, some are publicly traded on major stock exchanges.

If I Open an Offshore Structure, Will This Lead to Tax Authority Scrutiny?

What we advocate is not illegal; it therefore does not attract undue attention from the authorities. It is activities like money laundering, tax evasion and controlled accounts that the tax authorities are interested in, not law-abiding citizens protecting their assets and lowering their tax burdens.

How Long Does It Take to Set Up an Offshore Corporation/Structure?

The timeframe varies by jurisdiction and entity type. Most offshore corporations can be established within 1-3 business days in jurisdictions like Belize, Nevis, or Seychelles. More complex structures like trusts or foundations may take 1-2 weeks. Jurisdictions with stricter compliance requirements may take 2-4 weeks. Opening associated bank accounts typically adds another 2-6 weeks to the process, depending on the banking institution's due diligence procedures. We work to expedite the process wherever possible while ensuring all documentation is properly completed.

What Documentation Do I Need to Provide to Establish an Offshore Entity?

Standard documentation requirements include: a valid passport or government-issued ID, proof of residential address (utility bill or bank statement dated within the last 3 months), a professional reference letter (from an attorney, accountant, or banker), and a bank reference letter. Some jurisdictions may also require a curriculum vitae or resume, and documentation regarding the source of funds. The specific requirements vary by jurisdiction and the type of structure being established. We provide a complete checklist once you've selected your preferred jurisdiction.

Can I Set Up an Offshore Structure Remotely, or Do I Need to Travel?

In most cases, you can establish an offshore structure entirely remotely without ever visiting the jurisdiction. Modern offshore service providers like Offshore Protection handle all incorporation paperwork, apostille certifications, and filings on your behalf. Documents can be signed, notarized, and authenticated in your home country and then submitted to the offshore jurisdiction. However, some banking institutions may require an in-person visit to open accounts, though an increasing number now offer remote account opening with proper documentation and video verification.

What's the Difference Between an Offshore Corporation, LLC, Trust, and Foundation?

An offshore corporation is a separate legal entity with shareholders and directors, offering strong asset protection and business operation capabilities. An offshore LLC (Limited Liability Company) combines elements of corporations and partnerships, offering flexibility and typically simpler management. An offshore trust involves transferring legal ownership of assets to a trustee who manages them for beneficiaries according to trust terms - excellent for estate planning and asset protection. An offshore foundation is a hybrid structure similar to a trust but structured more like a corporation, popular in civil law jurisdictions. Each has different formation requirements, costs, management structures, and ideal use cases.

Which Type of Entity Is Best for My Situation?

The best entity depends on your specific goals:

• For active business operations: An offshore corporation or LLC
• For asset protection and estate planning: An offshore trust or foundation
• For investment holding: An offshore corporation or LLC
• For privacy: A foundation or properly structured corporation with nominees
• For U.S. persons seeking simplicity: An offshore LLC may offer certain tax benefits
• For multi-generational wealth transfer: A trust or foundation

Your home country's tax treatment of different entities is also crucial. We recommend discussing your specific situation with our advisors who can evaluate your goals, assets, and jurisdiction to recommend the optimal structure.

What Are the Annual Compliance Requirements?

Annual requirements typically include: payment of annual government fees or franchise taxes (ranging from $300-$2,000+ depending on jurisdiction), maintaining a registered agent in the jurisdiction ($200-$800 annually), filing annual returns or declarations in some jurisdictions, maintaining proper corporate records and minutes, and ensuring all licenses remain current. Some jurisdictions like Nevis and Belize have minimal annual compliance, while others like Cayman Islands have more extensive requirements. Additionally, you must fulfill all reporting obligations to your home country's tax authorities. We offer annual compliance management services to ensure all deadlines are met.

Do I Need a Nominee Director or Shareholder? What Does That Mean?

A nominee director or shareholder is a person or entity that serves in that role on your behalf, providing an additional layer of privacy by keeping your name off public records. While you retain ultimate control through private agreements, the nominee's name appears on public filings. This is legal and common in offshore planning. Whether you need nominees depends on your privacy objectives and jurisdiction requirements. Some jurisdictions maintain public registries of directors and shareholders, while others don't. Nominee services typically cost $300-$1,500 annually per nominee. However, modern transparency requirements (CRS, beneficial ownership registries) mean that privacy from government authorities is increasingly limited.

What Ongoing Costs Should I Expect?

Ongoing annual costs typically include:

• Government annual fees/franchise taxes: $300-$2,000
• Registered agent fees: $200-$800
• Nominee director/shareholder fees (if used): $300-$1,500
• Bank account maintenance fees: $0-$500
• Accounting and tax compliance: $500-$3,000+
• Professional management fees (if applicable): $1,000-$5,000+

Total annual costs for a basic structure typically range from $500-$2,000, while more complex structures with active management can cost $3,000-$10,000+ annually. These costs should be weighed against the benefits of asset protection, tax savings, and privacy you receive.

Can I Use My Offshore Company to Conduct Business in My Home Country?

Generally, yes, but there are important considerations. Your offshore company can contract with clients, vendors, or entities in your home country. However, if the offshore company maintains a "permanent establishment" in your home country (such as an office, employees, or significant physical presence), it may become subject to local taxation. Additionally, your home country may have Controlled Foreign Corporation (CFC) rules that attribute the offshore company's income to you personally for tax purposes, especially if the income is passive or the company is not conducting genuine business activities. Proper structure and substance are essential to avoid unintended tax consequences.

What Types of Businesses Are Suitable for Offshore Structures?

Offshore structures work well for:

• International consulting or professional services
• E-commerce and online businesses serving international markets
• Software development and digital products
• International trading companies
• Intellectual property holding and licensing
• Investment holding and portfolio management
• International shipping and logistics
• Import/export businesses
• Multi-jurisdictional operations

Businesses that require significant physical presence, local licensing, or face-to-face customer interaction in your home jurisdiction are typically less suitable. The key is having genuine international activities or assets that justify offshore structuring.

Who Should NOT Go Offshore?

Offshore structures are not appropriate for:

• Individuals seeking to hide income or evade taxes
• Those unable or unwilling to comply with proper reporting requirements
• People with primarily domestic assets and business activities with no international component
• Those with insufficient assets to justify the setup and ongoing costs (generally less than $50,000-$100,000 in assets)
• Individuals in professions with strict regulatory restrictions on offshore activities
• Anyone looking for a "magic solution" without proper professional guidance

Offshore planning requires commitment to proper compliance, sufficient assets to justify costs, and legitimate international business or asset protection needs.

Can I Transfer Existing Business Assets to an Offshore Entity?

Yes, existing assets can be transferred to offshore entities, but this must be done carefully. Asset transfers may trigger tax consequences in your home jurisdiction (capital gains taxes, transfer taxes, etc.). If you're transferring assets to avoid existing creditors or litigation, this could be considered a fraudulent conveyance and be reversed by courts. The best time to establish asset protection is before any threats arise. When transferring assets, proper valuation, documentation, and tax planning are essential. Real estate, intellectual property, investment portfolios, and business interests can all potentially be transferred, but each requires specific consideration of tax and legal implications.

Offshore Banking FAQs

Isn’t Moving Assets Offshore Illegal?

There is nothing illegal about moving assets offshore. It is when you move the assets into accounts offshore and do not declare their existence to the tax authorities that you break the law. Any assets over which you have control, domestic or offshore, are probably liable to taxes in your home jurisdiction.

Can I Retain Control Over My Money, Possibly Through Investment or Bank Accounts in My Home Jurisdiction?

Many people would like the 'safety' of an offshore asset protection structure but would like to keep complete control over the assets, trading accounts etc. This is possible but gives a direct link to the assets and will probably lead to any legal structures that were set up being ignored for both tax and protection purposes. Offshore asset protection does require you find people you trust to advise you and take care of finances for you.

How Do I Open an Offshore Bank Account?

Opening an offshore bank account involves several steps: First, select an appropriate banking jurisdiction and institution that suits your needs. Second, complete the bank's application forms and gather required documentation (passport, proof of address, bank references, source of funds documentation). Third, submit your application along with the required documents. Many banks now conduct video calls as part of their Know Your Customer (KYC) procedures. Some banks require minimum initial deposits ranging from $1,000 to $100,000 or more depending on the institution. We can assist in identifying suitable banks and preparing your application to meet their requirements.

Can I Still Access My Money Easily When It's Offshore?

Yes, offshore accounts offer multiple access methods including online banking, wire transfers, debit cards, and in some cases, ATM cards that work internationally. Most modern offshore banks provide sophisticated online banking platforms comparable to major domestic banks. You can typically transfer funds, pay bills, and manage investments electronically. However, you should be aware that international wire transfers may take 1-3 business days and may involve fees. The key is selecting the right banking institution with services that match your access needs.

What Are CRS and FATCA, and How Do They Affect My Offshore Accounts?

CRS (Common Reporting Standard) is an international agreement where participating countries automatically exchange financial account information. FATCA (Foreign Account Tax Compliance Act) is a U.S. law requiring foreign financial institutions to report accounts held by U.S. persons to the IRS. These regulations mean that your offshore accounts will likely be reported to your home country's tax authorities. This doesn't make offshore structures illegal or ineffective - it simply means you must comply with reporting requirements. Legitimate offshore asset protection and tax planning work within these frameworks, focusing on legal structures and proper reporting rather than hiding assets.

Will I Be Able to Get a Debit/Credit Card Linked to My Offshore Account?

Many offshore banks do offer debit cards (and some credit cards) linked to your accounts. These cards typically work on major networks like Visa or Mastercard and can be used internationally. However, availability varies by bank and jurisdiction. Some banks charge annual fees for card services ranging from $50-$200. Transaction fees for international use may also apply. When selecting an offshore bank, card availability and associated fees should be part of your evaluation criteria if this feature is important to you.

Offshore Asset Protection FAQs

Why Should I Move Offshore?

Moving some of your assets offshore provides you access to modern (and ancient) methods of protecting your assets and reducing your taxes using international corporations and foundations

What Is Asset Protection?

Asset Protection is a term used to describe the concept of legally transferring your assets into a legal entity which will protect them from attack by frivolous litigation, seizure from government, attack from an estranged spouse - in fact anything which may threaten your hard earned wealth.

A Friend Said That Offshore Asset Protection Is Immoral, Is It Really?

Some people are quite happy to stay in a system that has a high tax rate and system that keeps their assets exposed. That is their individual choice. There are other people who prefer to protect their hard earned money and get away from the system. There is nothing immoral in trying to protect your hard-earned assets so that you and/or your family can benefit from them later on. It is the essence of rational self-interest.

Which Is the Best Offshore Jurisdiction To Use For Asset Protection or Estate Planning?

Most modern tax havens are very much alike with respect to their tax laws and services, although some do offer entities not available in others. Certain tax havens have developed bad reputations over the years due to abuse by certain elements of the offshore industry, but most are quite safe. As with any financial plan, it is usually best to use a mix of jurisdictions, picking the best from three or four areas.

How Much Does an Asset Protection Structure Cost?

At Offshore-Protection.com we believe in providing value for money for our clients. Furthermore, when providing our services, our focus is on building the quality and value of relationships with our clients over an extended period of time. Basic asset protection structures start as low as US$1500 for an average family, with annual costs as low as US$500.

Of course this cost rises with the complexity involved and whether or not you are looking to take advantage of our professional management and account signatory services. This is why we provide what we call an 'Offshore Identity Package' which is a way of initiating the move to go offshore without a large initial investment. Additional products and services can be added to it to enhance it’s usefulness and value.

What Is the Minimum Amount I Should Start With?

That depends on your reasons for going offshore. If it is for asset protection you should be considering how much you are risking by not going offshore, namely lawyers fees, time, loss of assets etc. If it is for tax reasons you should be looking at the annual costs against how much tax you can save. Our 'Offshore Identity Package' is designed as an absolute minimum, but depending on your requirements you should take a good look at the more comprehensive packages and their resulting benefits.

Are There Any Other Advantages to Going Offshore?

Once a structure has been legally created it can be used for international trade and investment. This opens up a whole new arena that the average unstructured citizen cannot usually access.

Legal & Compliance

What Are My Reporting Obligations to My Home Country?

This varies significantly by your country of residence. U.S. citizens and residents must report foreign financial accounts exceeding $10,000 through FBAR (FinCEN Form 114) and may need to file Form 8938 for foreign financial assets. U.S. persons must also file Forms 5471 or 8865 for ownership in foreign corporations or partnerships. Most OECD countries have similar disclosure requirements. UK residents must report offshore income on their self-assessment tax returns. Failure to comply with reporting requirements can result in severe penalties. We strongly recommend consulting with a tax professional in your home jurisdiction to understand your specific obligations.

What Is the Difference Between Tax Avoidance and Tax Evasion?

Tax avoidance is the legal practice of structuring your financial affairs to minimize tax liability using methods approved by tax law. This includes using offshore structures, taking legal deductions, and strategic timing of income and expenses. Tax evasion is the illegal practice of not paying taxes owed by hiding income, inflating deductions, or failing to report taxable accounts. The difference is legality and transparency. Legitimate offshore planning involves tax avoidance - using legal structures while fully complying with all reporting requirements. Offshore Protection advocates only for legal tax avoidance strategies, never tax evasion.

Do I Need to Report My Offshore Corporation on My Tax Return?

In most cases, yes. The specific forms and requirements depend on your country of residence and the nature of your offshore structure. U.S. persons must typically file Forms 5471 (for foreign corporations), 3520 (for foreign trusts), and potentially other forms depending on the structure. Most developed nations have similar requirements under their controlled foreign corporation (CFC) rules. Even if your offshore corporation doesn't generate immediate taxable income, reporting requirements often still apply. Non-compliance can result in penalties of $10,000 or more per year per unreported entity. Always consult with a qualified tax advisor regarding your specific reporting obligations.

What Happens If Tax Laws Change in My Home Country or the Offshore Jurisdiction?

Tax laws do evolve over time, and structures must be adaptable. Reputable offshore jurisdictions have stable legal systems and rarely make dramatic changes that would undermine existing structures. However, your home country's laws may change more frequently. This is why we recommend periodic reviews of your offshore structure (every 2-3 years minimum) to ensure continued compliance and optimal effectiveness. If laws change significantly, structures can usually be modified, relocated to different jurisdictions, or restructured to maintain legal compliance. Working with experienced professionals who monitor regulatory changes is essential for long-term success of offshore planning.

Privacy & Confidentiality

How Private/Confidential Is My Offshore Structure?

Privacy levels vary significantly by jurisdiction. Some jurisdictions like Nevis, Belize, and Seychelles don't maintain public registries of company ownership, providing strong privacy from the general public and potential litigants. However, privacy from government authorities has decreased significantly due to CRS, FATCA, and beneficial ownership registries. Most offshore jurisdictions now participate in automatic information exchange with other countries' tax authorities. Privacy today means protection from civil creditors, business competitors, and the general public - not from your home country's tax authorities. Any legitimate offshore structure requires full compliance with reporting requirements, which means disclosing the structure to relevant authorities.

Who Can Find Out That I Have an Offshore Company?

Your home country's tax authorities will likely know due to CRS/FATCA reporting and your own required disclosure filings. Law enforcement can access this information through proper legal channels. However, civil litigants, business competitors, and the general public typically cannot easily discover your offshore holdings, especially if you use nominee services and select jurisdictions without public ownership registries. The key distinction is between privacy from government authorities (increasingly limited) and privacy from private parties (still quite strong in many jurisdictions). Offshore structures provide asset protection by creating legal barriers even if the structure's existence becomes known.

Are Offshore Company Ownership Records Public?

This depends entirely on the jurisdiction. Some offshore havens like Nevis, Belize, Seychelles, and Cayman Islands do not maintain publicly accessible registries of beneficial owners. Others may have searchable public records. However, even in jurisdictions without public registries, beneficial ownership information is typically maintained by the registered agent and can be accessed by authorities through proper legal channels. The European Union and other jurisdictions are increasingly pushing for public beneficial ownership registries. When selecting a jurisdiction, understanding their specific public disclosure requirements is important if privacy is a priority.

How Secure Are Assets in Offshore Jurisdictions During Economic Crises?

Properly selected offshore jurisdictions can actually provide greater stability than some domestic options during economic crises. Top-tier offshore banking centers like Switzerland, Singapore, and the Cayman Islands have strong banking systems, stringent regulatory oversight, and significant financial reserves. They're often more conservative than domestic banks and have weathered global financial crises well. However, jurisdiction selection is critical - not all offshore locations are equally stable. We recommend using established jurisdictions with strong legal systems, political stability, and sound banking regulations. Diversifying across multiple jurisdictions and institutions further reduces risk.

What Happens to My Offshore Structure If I Die?

This depends on how your structure is designed. Offshore trusts and foundations are specifically designed for multi-generational wealth transfer and continue operating after your death according to the terms you've established. Offshore corporations typically pass to heirs according to share ownership, similar to domestic companies. Proper estate planning should include clear succession instructions, updated beneficiary designations, and ensuring your heirs or executors have information about the offshore structures and access to necessary documentation. Many people establish offshore trusts specifically to avoid probate and ensure smooth wealth transfer to beneficiaries while maintaining privacy and asset protection for future generations.