Even though registering in the same country is typically more straightforward and cost-effective, founders of many companies regularly opt for registering their company abroad in more favorable jurisdictions. There might be several reasons for this, including the fact that foreign jurisdictions offer more regulatory clarity and have a friendlier investment climate.
Company in Tax-friendly Jurisdiction
Company in Cyprus
Key features
A visit to Cyprus is not required to form your company.
Minimum of 1 Director – can be any nationality and can reside anywhere in the world, can also be a corporate body.
Minimum of 1 shareholder required.
Tax rates
VAT – 19,5%
Dividend tax – 17%, but if not residing in Cyprus you can get an exemption
Corporate tax 12,5%
Process
The first step in the process is the approval of the company name by the Registrar of Companies, which takes 2-3 business days. Once approved, the required documentation must be completed by the Registrar of Companies and from that date, it will take approximately 5 business days to complete the entire procedure. Thus, bureaucracy is kept to a minimum.
Incorporation fee - 2100 EUR
Company in Isle of Man
Key features
The Isle of Man currently has full Double Taxation Agreements with the UK, Guernsey, Jersey, Luxembourg, Singapore, Malta, Seychelles, Estonia, Qatar and Bahrain as well as agreements for the avoidance of double taxation on individuals with several other countries.
Minimum of 1 Director – can be any nationality and can reside anywhere in the world, can also be a corporate body.
Minimum of 1 shareholder required.
A visit to the Isle of Man is not required to form your company.
Tax rates
Standard VAT rate 20%.
0% Corporate Tax – As long as your company is not a property company or retailer earning more than £500,000 in the Isle of Man (which are taxed at 10%/15%) there is a zero rate of corporate tax
Dividends to non-residents are taxed at 0%
No Capital Gains Tax – There is no tax to be paid on capital gains derived from the sale of any holdings
No Withholding Tax is due on dividends payable to shareholders.
Double tax relief is available for foreign tax paid
Company types
Company types in Isle of Man:
Company Limited by Shares – The most used company where the liability of its members is limited to the amount unpaid on shares they hold.
Company Limited by Guarantee – Such companies have no fixed capital and no shares. The members’ liability is limited to the amount they have agreed to contribute.
Unlimited Company – This company is like a civil law partnership and its use is usually limited to situations where a corporate personality only is required. The company has a share capital, but there is no limit to the liability of the members.
Incorporation fee - 4800 EUR
Gibraltar
Key features
There is no requirement to disclose the identity of the Beneficial Owner of a Gibraltar Non-Resident Company and secrecy is guaranteed by legislation.
Non-resident companies are free of tax on income not derived from Gibraltar or not remitted to Gibraltar. (It is advised to have your bank account outside Gibraltar).
There is a minimum Share Capital of 100 British Pounds.
Non-resident corporations do not require more than one director.
A director may be a natural person or a corporate entity.
Single Shareholder Company allowed
A resident secretary is required and can be provided by us.
There is a Public Register of Shares but Nominee Shareholders are generally used.
Tax rates
Corporate tax – 12,5% (utility and fuel supply companies 20%)
There is no VAT in Gibraltar