Uses of Isle of Man Companies
Trading Companies
An offshore company can act as a distributor or sales company accepting orders directly from the customer and arranging delivery of the goods directly to him from the manufacturer or supplier. The surplus arising on the difference between purchase and sales price may be accumulated free of tax. This can be of particular interest where goods are purchased in one country and sold in another, yet the owner is located in a third country.
Professional Services
A person working overseas may be able to limit his tax burden by receiving, into the country in which he is working, a fixed level of remuneration and accumulating the balance in an offshore company. Similarly, designers, authors, consultants and entertainers may assign or contract with an offshore company the right to receive fees due under a contract for services.
Investment Companies
Investment in property, stocks and shares, commodities and other assets. The offshore company may provide anonymity and tax savings. Funds accumulated can be invested or deposited throughout the world, although the funds may be subject to the tax regimes of the countries in which the investments are located.
Inheritance Tax or Estate Tax Protection
Where a person is domiciled outside a territory and owns assets located in that territory, for instance, property, then such assets may be protected against inheritance tax and higher rates of taxation by holding the assets through an offshore investment company.
Using Double Taxation Treaties
The use of companies incorporated in certain jurisdictions may be of benefit where double taxation treaties exist between the offshore jurisdiction and the country in which an investment (business/enterprise) may be made.
Royalties/Patent/Copyright Holding Companies
The purchase or assignment of the right to use a copyright, patent, trademark or know how by an offshore company, which may accumulate the royalties received in the offshore financial centre. In some circumstances the royalties may be subject to withholding tax at source, however, the interposing of a second company in another jurisdiction may reduce the rate of tax withheld at source.
Shipping Companies
Ships or yachts may be owned by an offshore company and registered in an offshore jurisdiction.
Overseas Property
Many of the difficulties and expenses associated with investment in overseas property, such as holiday villas, may be avoided through the use of an offshore company to hold the title of the property. It may also assist in avoiding capital or estate taxes in the country in which the property is situated.
To find out more about offshore companies in the IOM please click on www.chesterfield-offshore.com, or call us on +353 1 431 9663.
