Types of Offshore Companies

The single most important factor in establishing an offshore business presence is which type of company you’ll choose to incorporate. This choice determines the kind of bank account you’ll need to open, the level of tax breaks you’ll receive, and a variety of other factors as you continue conducting business from your offshore company.

In general, there are two major types of company structures, and within that framework there are several subcategories that further characterize your business dealings.

The first major category is the LLC, or the Limited Liability Company. This is similar in structure to the UK Limited Company (LC) and the Limited Liability Partnership (LLP). The second one is the IBC, or the International Business Company. (An IBC might also be called a BC, or simply Business Company, depending on your jurisdiction.)

The most significant difference between these two types is that an LLC can conduct business within the offshore jurisdiction where it has been incorporated, and an IBC cannot.

An offshore LLC is structured just like an onshore LLC. It requires articles of incorporation, managers who see to the administration of the business, and owners of the business (called members).

An IBC, on the other hand, provides much more flexibility in the corporate structure as the company type was created specifically for offshore tax havens and offshore financial centres. An IBC is exempt from its jurisdiction’s taxation laws, and needs only a registered agent located in that jurisdiction to maintain the business on a minimum level. In addition, IBC owners have a wider range of company activity in which they can partake, and as always there is a confidentiality agreement surrounding the details and financial information of the IBC.

The types of companies that can be started within these major categories are varied and can include:

Segregated Portfolio Company (SPC), which compartmentalizes the assets, shares, and liabilities of a company. Collective investment companies and umbrella funds are usually the types of business that choose to function under the structure of an SPC.

Limited Guarantee Companies are popular among non-profit organizations, individuals who choose to incorporate for the purposes of estate planning, and other types of companies that determine insolvency based on predefined circumstances.

Share Capital Companies release shareholders of any liability for the company once the shares have been paid. Depending on the circumstances of a particular company structure, the shareholders are free to sell, transfer, or profit from their shares.

Partnerships are structured exactly how they sound - the owners of the company have a predefined percentage of the company, and share profits, claim losses and determine company activity according to their weight of percentage ownership.

No matter what structure you decide for your business, offshore companies are extremely flexible and can accommodate practically any current financial circumstance or future financial goal, including:

Financial planning
Internet Entrepreneurship
Investing
Marine vessel sales, administration, management
Personal Services
Trading

If you’re looking to learn more about how incorporating a company offshore can help your bottom line, please do not hesitate to contact us today. We’re happy to give you sound advice and also choose the offshore jurisdiction that is right for you .