Offshore companies mean a company that is registered, managed and operated in a foreign country where it receives certain financial, legal and tax benefits for being registered there. Offshore companies are an essential tool for most multi-national companies and serve as key components of the entire corporate structure. We’ll list down some points on offshore company formation in Singapore.
Forming an Offshore Company in Singapore
While offshore jurisdictions no longer suffer from stigma, it is still important to choose carefully keeping in mind the cost, reputation of jurisdiction and annual maintenance cost.
Why Should You Consider an Offshore Jurisdiction
- 1. You are or will be expanding with new shareholders coming in. Many investors, especially institutional investors prefer to invest through an offshore jurisdiction
- 2. The company is an investment (stocks/bonds/ real estates) holding entity – possible relief from Stamp Duty and Capital Gains. E.g. You incorporate an offshore company to be your main asset holding company (Holdco). Holdco has multiple subsidiaries (each a Subco). Each Subco owns a commercial real estate. If you wish to dispose any 1 real estate, you can simply sell the shares of the Subco holding that real estate. The stamp duty on sale of shares is often substantially lower than stamp duty of the real estate.
- 3. You are developing substantial Intellectual Property and intend to use it in various jurisdictions
- 4. Tax Planning
- 5. Higher returns on investment
- 6. Estate Planning
- 7. Enhanced Privacy
Please note that in certain jurisdictions, especially jurisdictions which have worldwide taxation, these arrangements might not give you appropriate tax planning advantage. We suggest you talk to your tax and legal advisors before implementing any structure.
Read more about Singapore Offshore Incorporation at Singapore Company Incorporation.