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Offshore Financial Centres: Which Jurisdictions are Best for Tax Avoidance?

Offshore Countries With Low-Tax and Few Financial Regulations

What is an Offshore Tax Haven?

Tax havens are low-tax or tax-free countries with laws that maximize personal and banking privacy while minimizing taxation and regulatory interference for individuals and corporations. Often misspelled as 'tax heavens', these offshore jurisdictions specialize in furnishing financial, legal and business services to non-resident offshore companies, and provide investing opportunities for offshore capital.

Although financial regulations are typically enacted with the best of intentions, they tend to make business more complicated than it needs to be for some investors and businesses. Many offshore financial centres have responded to these concerns about regulations by adapting a more business-friendly regulatory structure.

Many states and nations design their policies with the goal of attracting business from foreign investors who want to be as tax-efficient as possible. These countries have tax policies and bodies of corporate law which provide a good financial climate for large investors and corporations who want to minimize tax exposure and all forms of financial regulations. The state of Delaware in the US, for example, drew business to it in the early 1900's by enacting laws that made it far easier to form and manage a corporation.

Tax haven countries that top the list for the efficient corporate legal structure include Panama and the British Virgin Islands. Other nations on that list, which have also made a name for themselves by building business-friendly regulatory structures, include Nevis, Mauritius and Seychelles, to name a few.

Many investors place a high value on the security of their funds, which is not always respected by their home countries. Although this is not true of all offshore financial centres, nations such as the Bahamas, St. Vincent, Seychelles, Belize and Mauritius have designed their privacy laws with the concerns of foreign investors in mind.

Because privacy laws are constantly shifting in this day and age, it is frequently wise to speak with an advisor about selecting an offshore financial center based on privacy concerns.

Offshore Tax Haven or Offshore Financial Centre -Definition

An offshore financial centre or OFC can be defined as 'as a country or jurisdiction that provides financial services to nonresidents on a scale that is incommensurate with the size and the financing of its domestic economy.'± A financial centre or nation has designed its laws in a way that attracts non-resident business investors. Some nations make it easy to manage corporations incorporated in their jurisdiction while others have an especially sensible regulatory structure or stringent privacy laws. There really is no easy way to differentiate one type of Offshore Financial Centre to another, as

When selecting a suitable tax haven country, be sure to consider all of your investments’ unique needs. At Offshore-Protection.com, we are poised to help you identify these needs and subsequently develop an offshore market strategy that maximizes profitability and long-term success.

Best Tax Havens List from Offshore Protection

Offshore-Protection.com specializes in asset protection through the formation and administration of structures set up in multiple tax haven countries, which include anonymous corporations, IBCs, foundations, trusts, bank accounts and other vehicles. We believe the strongest offshore structure is one that takes advantage of a multi-jurisdictional approach, one designed specifically to meet your business and banking needs.

Therefore, although we can incorporate in almost any jurisdiction, the following have special appeal (click on the links below to see more in-depth information about these tax havens):

One tax haven Jurisdiction cannot do it all!

What is the Best Offshore Formation Structure and Jurisdiction for Secure Asset Protection?

What is really required to ensure you are covered on all fronts is a multi-jurisdictional approach. As today many jurisdictions have been forced to change their offshore financial legislation to adhere to the demands of the Western developed world. With more and more global regulations and money-laundering initiatives being formed, FATF, FATCA, OECD, and CRS together with much more restrictive KYC requirements, many offshore jurisdictions have been forced to change their offshore corporate laws to ensure compliance, else risk being 'blacklisted'.

Banking and Offshore privacy is still a major concern in the offshore industry, and is something most would like to keep, but there needed to be new ways of re-structuring offshore entities to face the changes in the financial reporting and global regulatory environment.

AN INTERNATIONAL FIDUCIARY STRUCTURE Or MULTI-JURISDICTIONAL APPROACH

An International Fiduciary Structure or creating an offshore structure combining two different company formation products in two-separate jurisdictions gives a multi- jurisdictional advantage.

For example, an IBC is formed and held in Belize with the use of nominee services, and becomes the company director/beneficial owner of a Nevis LLC or Trust where the assets are placed. Consequently, any court order, suit or claim must navigate two separate legal system, many of which do not recognize foreign court ordered civil suits, or if they do, they have lengthy and very costly legal processes, that all but keeps the assets from being seized. Without a clear indication of criminal activity, there would be virtually no way to break the iron clad asset protection structure. 

Taken separately, Panama still offers the best all-around option of any jurisdiction, for reasons of cost effectiveness, privacy and flexibility. After Panama, other jurisdictions we highly recommend are: 

Other popular offshore jurisdictions such as the Cayman Islands, Anguilla and the Channel Isles are beginning to see the troubles associated with their lack of true independence and association with the EU by proxy of the UK. These and others have succumbed to pressure from the EU, UK and USA in recent years.

Some have adopted undesirable measures; signed information exchange agreements or, mutual legal assistance treaties; and tax information exchange agreements which are largely one-sided agreements in favor of the larger countries.

In fact, many of these island jurisdictions, such as the Caymans, contain clauses at the end of their respective constitutions which essentially give the British Crown, through its proxy Governor, the right to enact laws and regulations without any vote at all.

Even though many of these jurisdictions would not be considered privacy jurisdictions in the same way as Belize or Panama, we can tailor solutions that utilize nominees, along with Panama foundations or Belize trusts that will provide maximum anonymity where legitimate business reasons require it.

We have agents in almost every other major offshore jurisdiction, so if you have special jurisdictional requirements or preferences outside of these that are listed in this site, please contact us and we will give you the pros and cons of your choice(s).

Ten Criteria for Choosing the Best Tax Havens

Selecting a tax haven country is an integral part of establishing an offshore structure or financial account. The jurisdiction that you choose should have at the very minimum, the following 10 characteristics:

1. Low Tax Jurisdiction - With little or no taxation including no capital gains tax, no income tax, no inheritance tax, no gift tax etc...

2. Favorable Incorporation Laws - Corporate laws should allow for one Director from any country, have efficient processes, and protect the rights of the vehicle

3. Stable Currency  - The country should have no restrictions on the movement of funds in or out of the country 

4. Strict Privacy Laws - There must be strict privacy laws that protect you from public and governmental scrutiny keeping safe your personal information and accounts and shield you from foreign arbitrage 

5. Stable Government - Your offshore jurisdiction must be politically and economically stable to ensure continuity and environmental security

6. Growing Economy - The economy should be open to international markets, transactions and the movements of both physical and physical goods and provide a diverse environment for business and investment

7. Secure Banking System - There should be a sophisticated banking system offering a diverse range of financial and banking procedures

8. Favourable Communications System - Communications systems should allow for stable and secure source of communications across all channels

9. Reputation -  The reputation of the country should be in good standing as a secure and stable offshore jurisdiction

10. Time Zone Compatibility & Close Location - the time zone should be such that you can contact your offshore provider or financial institution during business hours 

Peruse the offshore tax haven list above and be sure to Contact us if you have questions regarding the offshore business structure that's right for you.