Offshore Companies - anyone?

randomshenans · 13 May 2014 at 09:42

I'm at a stage where I am required to legally form a couple of companies, as without it, it's difficult to carry on, especially with some further dealings.

Due to living in France, where I simply would not start a business (1. It's France, 2. I'd get stuck for paperwork for years and not understand a thing, 3. It's France) and yes, I'm next door to Switzerland which as most (without prior knowledge) would say would be the best bet.

However, to start a business in Switzerland (without living there) you are required to pay c.8k CHF (5k GBP) to form, which includes rental for said location you will be "based" at and everything paperwork wise, but you are also required to have 20k capital in the company account and a revenue of 12k a year in writing.

Now I'm not at the stage where this is possible on either. Building software and trying to partner with companies with one, and the other is product prototype and testing currently and hell, I'm trying to keep the burn rate as slow as possible.

Which led me to look at offshore companies...

Has anyone set one up? Plus points and negative points? Any companies that are good for this?
I was looking at Belize due to lack of need to be there and quick formation turnaround.
Downside I read was that nothing is written down on public ledgers, like they have in companies house.

Rather niche question I realise.

Windle · 13 May 2014 at 09:46

Can you not setup the business in the UK?

randomshenans · 13 May 2014 at 11:51

I don't live in the UK either, so formation of UK company can be done remotely, the setting up of an account linked to that business has normally to be done in person.

Kemik · 13 May 2014 at 13:15

Where will all your business transactions be occurring? Are they all with French companies? There is a problem in that if you set up a company overseas and then perform all of your work in France you will have a permanent establishment in France and they will want their tax. There are also various other factors to think about.

If you're transacting across Europe then, if you manage to get around the bank issue, the UK has one of the smallest admin burdens for companies in the world.

randomshenans · 13 May 2014 at 13:52

Business would be conducted throughout Europe and the world. (I would hope...) But it's not a location based business in any sense, so transactions could be done with French businesses, but it'll be more globally online that local.

boxman2000 · 13 May 2014 at 13:54

UK probably cheapest, don't have figures to hand for formation but annually only a few ££ a year to Companies House but depends on your tax situation of course.

Guernsey is another option, £500 per year filing fees, formation not too cheap but message me in trust if you want more info there.

BVI and Bahamas is around $750 per year for annual fees. New Zealand is under £100 if I remember correctly.

To get it right you might want to speak to a tax advisor as if you're going to be employing people through the companies then that changes things a bit, depending on the jurisdiction you're in of course.

All jurisdictions will need certified CDD (client due diligence) such as passport or government issued photographic ID, at least 2 utility bills no more than 3 months old showing your name (mobile bills do not count) - these need to be certified by a practising lawyer or a qualified financial individual that is part of a professional body i.e. ACCA, ACA, TEP, IoD etc (definitely not a doctor) but would need to be certified in person but of course can be posted to bank(s) overseas.

Depending what you're doing, you may benefit from forming a company through a jurisdiction with a double taxation agreement with France. Getting proper advice is going to save you a lot of hassle, believe me!

Kemik · 13 May 2014 at 14:22

randomshenans said:
Business would be conducted throughout Europe and the world. (I would hope...) But it's not a location based business in any sense, so transactions could be done with French businesses, but it'll be more globally online that local.

What is expected turnover going to be (e.g. ~£50k? £100k+?) Will affect VAT registration implications.

randomshenans · 13 May 2014 at 15:10

Impossible to currently say, at this present stage, due to the unknown variable cost of unit licensing for a software we will be using, as such impossible to draft our cost structure.
Meeting with one of the CEOs tomorrow to discuss this further.

Could be anywhere between -1mil and 10mil?