If you’re looking to trade or invest in Bitcoin/Cryptocurrency using a tax free Offshore Company chances are:
(a) you’ll already have a stash of Bitcoin/cryptocurrency; and
(b) you are wondering how you could or should go about transferring ownership of that currency to your tax free Offshore Company, once incorporated.
However you go about it you’ll want to ensure that at the point when you realize your gain (eg when you convert the Cryptocurrency into Hard Currency) that, at that point in time, the Cryptocurrency is owned by – and the gain occurs in the name of – your tax free Offshore Company (“IBC”).
The first step is to transfer ownership of the Cryptocurrency to the Offshore Company/Entity.
Timing is of critical importance – It is clearly preferable for the IBC to acquire the Cryptocurrency (for example, Bitcoin) at the earliest possible time before the Cryptocurrency becomes highly valuable. That way the capital payment for the acquisition of the Cryptocurrency can be set at a lower amount i.e. before its true worth has been determined in/by the market. (These capital payments may even be deferred and or staggered by way of an instalment contract such as would enable the IBC to use subsequent gains to fund the cost of the Cryptocurrency).
If a deal is struck for the IBC to buy the Cryptocurrency before the Cryptocurrency gains traction in the market, ownership of the Cryptocurrency might even be transferred for nominal consideration enabling you to transfer legal ownership of the Cryptocurrency to the IBC before the Cryptocurrency experiences significant appreciation in value.
Alternatively, you might transfer ownership of the Cryptocurrency to your tax free Offshore Company for an agreed price but subject to a deferred or gradual payment basis. How that would work is you would transfer ownership of the Cryptocurrency up front and agree for the IBC to pay you in stages in consideration of a price premium and/or in consideration of the IBC engaging you in an ongoing/consultancy capacity.
However you transfer ownership of the Cryptocurrency to your IBC the transaction should be seen to be on commercial terms for fair market value.
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