A tax haven is a place where certain taxes are collected at a low rate or not at all, e.g. B. Seychelles tax for an offshore company is zero. This encourages wealthy individuals and/or businesses to establish themselves in areas that would otherwise be overlooked. Different jurisdictions tend to be havens for different types of taxes and for different categories of people and/or businesses.
The incorporation of an offshore company in Seychelles is permissible where the incorporated company does not conduct any substantial business in Seychelles. This kind of International Business Company [I.B.C] is known as a non-resident company.
The formation of an offshore Seychelles company can bring a number of benefits to individuals or companies incorporated under the Seychelles offshore laws.
* Taxation: Businesses can be structured to realize profits in a way that minimizes their overall tax liability.
* Simplicity: Aside from regulated entities such as banks or other financial institutions, incorporating an offshore company in Seychelles is relatively easy to incorporate and maintain.
* Reporting: The level of information required by the registrar of companies varies from jurisdiction to jurisdiction.
* Asset Protection: It is possible to organize assets and transactions in a way that protects assets from future liabilities.
* Anonymity: Conducting transactions on behalf of a private company allows the name of the underlying principal to be kept out of the documentation. However, current anti-money laundering regulations often require banks and other professionals to review company structures. The documentation for incorporating an offshore company in Seychelles is relatively straightforward.
* Thin Capitalisation: Seychelles offshore company formation allows rules for the thin capitalization of its IBC companies (excluding regulated entities such as banks and insurance companies) so that they can be incorporated with nominal equity.
* Financial Support: Seychelles offshore company formations are not normally prohibited from providing “financial support” for the acquisition of their own shares, thereby avoiding the need for a “whitewash” procedure in certain financial transactions.
* Seychelles offshore company incorporations are normally prohibited from doing business in their area of incorporation. You are also not allowed to invest in real estate in the Seychelles.
* Due to regulatory reasons, there are certain restrictions on the type of business that an offshore Seychelles company incorporation can engage in. For example, it is quite common for there to be general bans on offshore companies engaged in banking, insurance or a trust company.
* Due to the limited amount of publicly available information related to offshore companies, there are usually a high level of hidden costs at the administrative level.
For example, to open a bank account in the name of an offshore company and comply with relevant anti-money laundering regulations, the bank will typically require notarization of large volumes of company records in the country of incorporation and may require opinions from local attorneys in that jurisdiction as to the ability and authority of the company to open and maintain a bank account.
* Certain countries have “anti-tax haven” laws that make it difficult to do business with an offshore company in those countries. For example, capital markets regulations in France prohibit the use of offshore companies as vehicles for issuing bonds.
* When a shareholder in an offshore company incorporation dies it will normally be necessary to have the will also admitted to probate in Seychelles (or if there is no will to have the letters of comfort resealed in that jurisdiction) which may involve additional costs , delay and inconvenience in managing the estate of the deceased.
Features of Incorporating an Offshore Company in Seychelles
* Memorandum of Association and Articles of Incorporation or Articles of Incorporation – these documents are fundamental to the existence of the company and describe the rights of the members, the goals of the company and the internal processes of the company.
* Certificate of Incorporation: This is issued by the Trade Register and is proof that the company has been incorporated. Other information may be required to demonstrate that the company has not been liquidated or dissolved.
*Registrar: It is common for an agent to be appointed in the jurisdiction where the company is incorporated to handle official communications with the registrar.
* Registered Office: This is a company’s official address where official documents are sent and legal notices are received. It is common for the registrar to provide a registered office. A company may have different business and correspondence addresses.
* Members: These are the legal owners of the Seychelles offshore company incorporation. For administrative convenience or anonymity, a business service provider may identify nominees who hold shares on behalf of a beneficial owner and act at his or her direction.
* Directors: The people who manage the day-to-day affairs of the company. In many jurisdictions it is possible for corporations to be directors of other corporations. Corporate service providers in the Seychelles offshore jurisdiction often provide directors.
In principle, the company is considered to be resident for tax purposes in the place where the decisions are made.
* Nominee directors: In some cases, the formally appointed directors have been shown to act merely as alter egos of others, blindly following their directions. In these cases, the courts hold that those directing the nominated directors truly control the company and that the nominated directors merely approve decisions.
* Company Secretary: This is the person responsible for ensuring that the Seychelles offshore company formation complies with its legal obligations. Corporate service providers often offer this service.
* Legal Records: A company is required to keep registers containing certain information about the company. Mandatory records vary from jurisdiction to jurisdiction, as does the extent of public access to information contained in the records. Many jurisdictions require records to be kept within the jurisdiction in which the company is incorporated. The required records may include minutes of meetings, registers of members, directors, officers and dues.
* Accounting: Directors are generally required to keep proper records. You may be required to produce audited financial statements. Specific requirements vary between jurisdictions and may depend on the type of business the company does. For example, all banks are required to prepare audited financial statements, whereas a private investment company may not be required.
Types of offshore company formation in Seychelles
In order to facilitate business in the Seychelles, various types of company formation have been approved by the authorities. Examples of offshore companies are the Limited Liability Company (LLC) and the International Business Company (IBC). The following types of companies are common in offshore jurisdictions:
* Companies with share capital: These companies issue shares. Once the acquisition costs of a share (capital and premium) have been paid, the shareholders have no further obligations to the company. The shares can be sold or transferred subject to the Company’s regulations and the shareholders have the right to enjoy the Company’s profits or any liquidation proceeds.
* Limited Company: The Company’s shareholders agree to pay up to a maximum limit if the Company becomes insolvent. You can acquire certain rights against the Company, such as B. Rights to a dividend, and the specific rights are set out in the company’s rules. Membership can be terminated upon death, and guarantor companies have been used for charitable organizations. There are also sophisticated estate planning systems that use guarantee companies.
* Protected Cell Societies: Some jurisdictions, e.g. Cell companies, such as Mauritius and Seychelles, allow certain assets and liabilities to be partitioned into ‘cells’ so that the assets of one cell cannot be used to meet the liabilities of another. Cell companies are used in particular for umbrella funds or unit-linked insurance bonds.
Many offshore jurisdictions are increasingly offering specialized corporate forms, specialized trusts and partnerships to increase their market share.
Examples include limited life companies, unlimited companies, limited companies with a share capital, limited purpose companies, and hybrid entities such as limited partnerships, which more closely resemble corporations with actual partnerships, and foundations, which are nominally trusts , but are corporations rather than trusts.
The traditional method of merging companies is for a company to acquire the assets of a subsidiary upon its liquidation. This sometimes creates contractual difficulties and requires third parties to join the transfer of obligations from the liquidated company. Some jurisdictions have addressed this issue by allowing companies to merge and form a new combined entity that is a continuation of the businesses of the respective previous companies.
relocation of companies
Some jurisdictions allow corporations to incorporate. You can do this to take advantage of special features of the new case law, such as: B. Merger laws or tax treaties with other countries. The law of both the old and new jurisdictions must permit transfer of residence. The business operations of the company are deemed to have continued uninterrupted at the time of the change of residence.