What about offshore for Internet business? Is it worth to buy a company and to open an account?

Certainly most of you have heard more than once how it is convenient to conduct financial activities through the offshore especially as far as it concerns Internet business. Actually if your project functions in the Internet and provides online services then work through the offshore company may be very profitable. But what to do first? And is it worth to get involved in buying «offshore company» and opening offshore account? Let’s try to examine this issue…

Here are some elements for the beginning. The offshore company all over the world is considered a company which has been registered in one country but make their activities in another country. Accordingly it does not only conduct its activities but even derives its income beyond the jurisdiction where it has been registered. Of course there are some clauses in the international jurisdiction saying that the offshore company shall pay taxes in the place where it conducts its activities but in the jurisdiction of many countries being offshore “paradise” there is information indicating that offshore companies do not have any obligations to present reporting (concerning its financial activities). Or they have to present reporting but requirements to it are not so strict and initial reports may be prepared by any “homebred” accountant. Therefore such countries are refuge for thousands of companies from every corner of the globe and earn large profits owing to the taxation absence.

So Internet business ideally suits to apply offshore as activities in the net do not tie to any world’s place and you can always prove that your business is conducted beyond the country which is native for the offshore company.

It is worth to say at once that someone who likes to do everything himself on registration matters will have to experience failure because it is a different case when you may send a letter, required documents, pay duty and promptly get documents’ package. Everything is much more difficult in this case. Most of countries require presence of a general director, secretary and financial director at offshore company’s registration. Sometimes it happens that if their personal attendance is not required then it is necessary to provide their documents. Besides that there are a lot of other pitfalls which are specific for each jurisdiction. Moreover there are two factors which prove that it is easier to buy an offshore company in agent-company than to register it. The first one is time. Undoubtedly everybody would like that offshore company’s registration proceeds without delay. The second factor is company registration date. The last one has utmost significance if you want to buy an offshore company for the project about which you would like to declare that company has been presenting on the market already for a long time. When it concerns agents they as a rule offer you a great deal of companies working for several years.

After having chosen through Google an agent who register an offshore company for you it will be necessary to provide the documents required to register the company. As a rule they will consist of a passport or its copy and an application written in the language applicable for jurisdiction in which the offshore company will be registered. It is worth to notice that there are 2 types of prices on offshore companies’ purchase. Let’s call them: cheap offshore companies and offshore companies with fair price.

What means cheap ones? These are companies which cost less than 1000 dollars. Such companies as a rule are drawn up on cemetery votes or moreover their constituent documents have been painted in Photoshop. Therefore such offshore is better not to buy for any serious long-life project. If you make HYIP or any seasonal service then such type of offshore will suit you. But in case of company with bright future it is better not to save on offshore.

Second type of offshore companies is companies which registered on real persons who theoretically may be found. Besides that in case of any incidents with such companies you can always find attorneys who agree to collaborate with you in order to assert company’s interests. Such offshore companies cost from $2500 and higher. Of course you may buy them as much cheaper as much more expensive. It depends on jurisdiction in which you will buy the offshore company.

So having an offshore company for your business you can register merchants for your service in order to receive plastic cards, to sign contracts and to conduct any operations lawfully independently from local legislation as all the roads lie open to the offshore companies. It is standard procedure to open an offshore account immediately after company registration. An offshore account may be opened as in the same jurisdiction where company has been registered as in any other country.

To open an account it is necessary to have company’s constituent documents as well as founders’ passports. But it may be some nuances. So, for example, to open an account in Panama except the above documents you have to provide two certificates confirming that company already have bank accounts. By the way the most widespread jurisdictions to open accounts from Russia are Panama, Cyprus, BVI and Latvia… The account opening cost may differ depending on the country. For example, you may open an account in Latvia for $300 but in Cyprus and Panama it will cost you about 700-1000 dollars.

Having the offshore company, offshore bank’s account and online banking panel you may control your business not leaving the computer and meanwhile you do not have to present reports to tax agency and to fear tax officer’s knock at the door.

As a result offshore company’s registration and account opening will cost you 3 – 4 thousands dollars. This is driblet especially if your project is really global. But before spending the money think over that there may be cheaper variants suitable for you. So, for example, if your only wish is to place company address on site there is no need to buy it. You may buy redirect service which provides you with real postal address in any country you want. The instance of such services is Yourcityoffice.com, Contactoffice.com and so on.

As far as it concerns financial operations many present payment systems allows conducting transactions with wire transfers without necessity to have a bank account. I.e. you have to register an account in these payment systems and then if in your Internet project there is need to receive services’ payment with wire transfer you provide your clients with bank details of payment system which after money receipt enter it in your account in this payment system. And from this account you may cash out your funds with quite a number of means beginning from Western Union and finishing with wire transfer to any account which suits to you. It means that you deliver yourself from registering of offshore account. The instance of such payment systems may be Perfect Money or less known Alert Pay…

It means that today you may find worthy alternatives to offshore technologies. The only thing you need is to estimate your demands precisely and in accordance with them to define if you need offshore company or it will be enough to use simpler means.

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