If you want to choose the cheapest destination to set up a company in 2024, always rely on competent advice. Look at the costs of registration, maintenance, and the economic situation in the countries you have shortlisted. The total expenses you will incur to form an offshore company may be higher than a standard incorporation fee. And even if you seem to have found the best place to register an offshore company, there may exist much cheaper countries where you can launch your business.
Cheap Offshores: Possible Pitfalls
First of all, a company needs a bank account to carry out business operations. Not all agents who offer company incorporation services can open an account for you, though. As a result, you buy a cheap offshore company and then look for a competent lawyer and pay enormous amounts to set up a bank account. Never buy ‘just a company’ – look for an agent who can provide it along with a bank account instead.
Second, if you see an offshore company offering at an extremely low cost, research why the price is so low. In the majority of cases, you will find out that the incorporation agent has a poor reputation or is not well-versed in the nuances of global financial institutions. In this case, buying an offshore company will be unreasonable no matter how much it costs: you will spend too much money and effort resolving the issues later on.
Choosing an Offshore Jurisdiction: Main Criteria
What should you consider when choosing an offshore jurisdiction for your company? There is hardly one simple answer, as each business and situation is unique. Of course, you will need to study fees and prices and asset protection laws in the countries that seem interesting. In addition, please check what factors may influence the reputation of the offshore legal entity and its founders.
See also: How to Transition Your Eyewear from Summer to Fall
Reputation of an Offshore Destination
The first reasonable thing to do would be to check whether the jurisdiction is whitelisted. Suppose you set up a company in a blacklisted jurisdiction. In that case, it will complicate your financial matters, as few banks want to tarnish their reputation by opening an account for a company from a blacklisted country.
What is more, many countries have their own blacklists, so you should check the countries you are going to work with as well. For instance, the British Virgin Islands is on the EU whitelist while being on the list of non-cooperative jurisdictions in Spain – so this is not a good option if you intend to work with Spain.
We have selected a few jurisdictions with a good reputation where you can start a business at moderate rates in 2024:
- Marshall Islands
- Panama
- Seychelles
- Nevis
- Belize
Price
Let’s look at the main aspects to consider when you choose a company whose incorporation does not cost much:
- Work experience, professional background, and reputation of the agent who offers registration support.
- The cost of re-domiciliation (transferring your company to another jurisdiction). Just count how much you will need to spend to take your business to a jurisdiction with a better reputation, and you will understand that the jurisdiction should be selected extremely responsibly.
- Local laws and regulations regarding non-resident companies: economic substance requirements, the need for registered office address, tax rates, banking services, registered agent’s services, and so on. Add it all up to see the final cost.
- The business area and the reason why you form an offshore company.
Never trust cheap promises: keep track of the latest updates and double-check the information. There have been many cases when gray schemes were used, and gullible customers simply lost their money. If you want to protect and increase your assets, choose a credible and reputable intermediary (like International Wealth or any other respected company) and observe the laws of the respective country.
Best Places for Cheap Offshore Company Formation
Europe
Several European jurisdictions offer tax benefits to non-resident companies if they derive 100% of their profits abroad. Since “offshores” do not exist in Europe nowadays, these destinations are usually called “mid-shores.” They are very popular and appreciated by business owners who can conduct operations globally and enjoy the world’s banking services at the same time. Here is a list of the best countries for starting your business:
- Poland
- Balkan countries
- Latvia
- Netherlands
- Great Britain
- Switzerland
Americas, Asia-Pacific, Western Asia
As far as this region is concerned, the top destinations are listed below:
- Canada
- Some US states
- UAE
- New Zealand
- Singapore
- Hong Kong
- China
Island States
We have shortlisted some island states where offshore company incorporation costs are not very high. The requirements for the start-up capital are minimized, which helps if you are on a tight budget. You will also enjoy low (or even zero) tax rates, confidentiality, and professional services:
- Cook Islands
- Seychelles
- Vanuatu
- Marshall Islands
- British Virgin Islands
- Nevis
- Belize (while this is not technically an island state, it still possesses all of its “economic” characteristics)
These jurisdictions do not tax your profits if they are derived from sources abroad, and you will not have to submit detailed tax returns or have your corporate records audited.
Still Looking for the Cheapest?
The cheapest solutions will not get your company far enough, while reasonably priced ones can. Business owners who opt for the most affordable offer discover very soon that they need a lot of additional effort to start heading for the aims they set at the time of incorporation.
If you would hate to become entangled in a dubious and painstaking business adventure, opt for professional assistance from the start. As a result, you will run all your business operations from the comfort of your home, and you will not have to fly half the world and spend your time and money to have a board meeting.
A good team that consists of an accountant, a lawyer, an auditor, and probably a couple of other experts will smoothly get your business going and explain all the local issues that may arise. You will be prepared for any goings-on and have a sound sleep at night! In reality, this is priceless.
If you are determined to find the cheapest solution, shortlist several options and compare them thoroughly. If you want, you can click on the above link to delegate this task to a specialist.
The most valuable lesson to learn from this article is that the sum of registration expenses does not always equal the total costs of a “cheap offshore company formation” found on the Internet: check hidden extras at all times!
