Hongkong Company Formation

Why Go Offshore
Many international businessmen prefer to register an offshore company instead of registering in local companies, there are indeed some advantages. Some of which are outlined below:

a) Tax benefits - if the business operations are arranged carefully the profits from the operations may become zero profits tax or a little profits tax.

b) Simplified set up procedure and requirements – some offshore companies can be registered within the same day, other offshore companies may require only one person registered.

c) Public undisclosure – some offshore companies allow public search, other offshore companies cannot get public search.

d) Costs and the fees – some offshore companies cost a little money, only a hundred of dollars, other offshore companies may cost thousand of dollars.

e) Reporting requirements – some offshore companies require periodic financial reports being filed, other offshore companies need not filing anything at all.

f) Limited liabilities – almost all offshore companies are private limited company in nature, the investors who subscribe the shares of the offshore company are limited to contribute up to this amount (of the shares), and no more.

However, there are some drawbacks which must not be overlook.

a) Financing – offshore companies are difficult to get lending from their local bankers even they are profitable or provide pledge of personal assets and personal guarantee.

b) Opening an offshore bank account – as the public records are not available, it is difficult to open an offshore bank account. Some bankers even say that they will not open bank accounts for offshore companies.

c) Types of business being done – offshore companies are common formed for such businesses as consulting, international trading, holding shares of other companies; but some nature of businesses are not allowed using offshore companies such as finance company, insurance compnay, trust company, etc.