How To Invest in Shares Using a Tax Free Offshore Company

Investing in Stocks/Shares is an activity that lends itself well to an “Offshore” Corporate Structuring Plan.


How it usually works is:


(a)  You incorporate a tax-free Offshore Company (“OC”)


(b)  You structure the Company in such a way as to ensure that the Company is  seen to be managed and controlled from Offshore – This can/will typically be achieved by via deployment of a nil tax jurisdiction based “Nominee” Director – which is a service that OCI can provide (ideally, especially if you live in a country which has CFC laws, you’d be wise to also set up a Private Foundation to hold the shares of/own your Offshore Company ie so that you aren’t classified at law as/seen at law to be the “beneficial owner” of the Company)


(c)   Your OC engages a Broker/opens a Brokerage Account


(d)  You advance funds to your OC


(e)  The OC then advances funds to the Broker’s Account


(f)    The Broker acquires the shares for you and registers your Company as the owner of those shares


(g)  The Company you hold shares in pays a return/dividend periodically to your OC (eg yearly). This return is banked into a tax-free Offshore Bank Account in the name of your OC


(h)  Returns paid to your OC can/will be held in an interest bearing bank/deposit account and or reinvested Offshore, potentially free from tax… AND if you incorporate Offshore ie in the right tax free Offshore jurisdiction you should also be able to avoid having to pay CGT ie Capital Gains Tax when you sell your shares (most “Offshore” company jurisdictions do not have CGT laws)


Note if you need to draw on these returns at home there are a number of discreet (& potentially tax-free) ways to go about this. But that’s a discussion for another day….


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