Offshore Company: A Guide to Company Incorporation

Most of us have heard the term “offshore company” but do you really know what it means? Simply put, an offshore company is a company that is incorporated in an offshore jurisdiction. An offshore jurisdiction is one that isn’t the jurisdiction you’re resident in or hold a passport of.

Favourable conditions including structural flexibility, some level of privacyand tax-efficiency are the most common reasons for international companies to incorporate in these jurisdictions.

One key difference between an offshore company and a regular company is that the offshore company doesn’t usually conduct business activities in the country it is based in. Instead, the company conducts activities from that country, internationally.

For example, you have an online gambling business that operates in Europe and parts of Asia. Setting up your international company in Curacao but maintaining your operations elsewhere, makes it an offshore enterprise.

Some people have the impression that an offshore company may not be legal but this isn’t the case. It’s a common misconception that offshore companies are used for criminals and tax dodgers looking to hide their wealth. While there are nefarious actors in every industry, offshore companies are predominantly used forlegitimate activities.

Offshore company incorporation doesn’t exclude you from the law, instead, you are bound by the laws of that jurisdiction. Matters like compliance, accounting, filing, and licensing must all be taken seriously, regardless of which offshore jurisdiction you opt for.