The advantage of incorporation is mainly to save and protect your wealth. Whether it is a registration offshore company, or an incorporation of a business in your country of residence.
Ok, I realize that I am not clear...so here goes.
Normally, your taxes are calculated on your income, wealth, and any 'capital' gains you have made over the tax year. This calculation is easy to do when every thing is in your name or the joint names of you and another person e.g. your wife.
And if you have taken a loan, then the lender can take all your possessions if you don't return the money on time.
Now, what about the advantage of incorporation?
However if your income was being received by a LLC incorporation company instead of by you directly, then the calculation of how much you were earning becomes a bit muddled.
What if your house, car, furniture and yacht were owned by a limited liability corporation? Now the calculation of your wealth - what you own is a little obscure.
Many countries have lower tax rates and different methods for the valuation of shares - which you would now own in the incorporated company - instead of your wealth directly.
Also, any one who has lent money - will now do so to your company. Not to you. And so will not be able to take your other assets except those that are owned by this company! That's another advantage of incorporation. And that is how businesses go bankrupt and the shareholders only lose the value of their shares in that company - not everything they own.
Once you form tax saving offshore companies, there are additional levels of confidentiality also. You can nominate on your behalf, directors or even shareholders, who will do as you say so that your name does not appear on any documents filed with the offshore tax haven's government.
So not only does your tax calculations become beneficial, but you only need to let your family, friends or any one else know what you own or earn - by your choice.
An offshore company incorporation or an offshore IBC [International Business Corporation]saves and protects wealth because:
1. What you earn and what you own are not easily identifiable.
2. Tax rates on shares of companies are often lower.
3. If in an offshore company, even your ownership of the company's shares is mostly - depending on the tax haven's disclosure laws - confidential. So conceivably you may not be taxed on those assets - unless you chose to do so.
4. Lastly, any lender to your incorporated company, or any person who is suing your company can only take what is owned by the company. Not all your assets.
The advantage of incorporation is big, even if you are a startup incorporation. A registration offshore company has even more advantages if you:
* Offer Professional Services
* Trade
* Own Investments
* Want a Holding Company
* Are Starting a Dot Com Business
* Own Property
* Are a Shipping Business
* Are an Employment Company
* Own Intellectual Property & Earn Royalty
* Own Assets e.g house, yacht, buildings, jewelery
* Work Abroad
Visit other parts of this website and see how easy it is to incorporate an offshore company, or incorporating a small business or even doing an incorporation on line.
See the above video on a startup business
Summary
Advantage of Incorporation – So many that you won’t be able to resist!
The process of forming a new corporation is called incorporation. Of course you have many questions!
• Why does someone need to make his company a corporation?
• Wouldn’t it increase the expenditures?
• What is the advantage of incorporation?
• Are there any disadvantages of incorporation?
All over the world businessman and investors are forming companies for many reasons which include both legal and non-legal ones:
1. An investor’s personal assets are protected from law suits.
This is one of the biggest advantage of incorporation. If you are running a business on your own or with other partners then in case of a law suit or bankruptcy if the courts feel that you were responsible and debts can’t be paid by liquidating the company’s assets, even your personal assets may be seized to cover them!
Another very important advantage of incorporation is the tax relaxation that incorporations get as compared to companies owned by individuals. Dividends from shares owned or capital gains from shares sold are taxed at lower rates in most countries.
3. Protection of your product or idea or brand
In present world where companies are known by their brand and their innovation, there is a greater need for their protection against copy right infringement.
Trademark incorporation is the solution for this problem as it gives all your ideas/products legal protection from being copied. Trademark incorporation is done when a corporation registers its original and unique name, product or ideas with the appropriate authority.
4. Raising Capital – Best way to expand your business
Short of capital? Have the passion to do a lot but don’t have the resources? Well the best way is to incorporate your business and sell shares. Though the company will not remain your personal property but you can still have a majority of the shares and a much bigger capital for the expansion of your business!
Also since incorporation brings more people as stake holders, you are no longer alone to worry about the success of the company.
5. Working abroad or planning to invest in foreign lands?
Get advantage of incorporation here as well!
Offshore asset protection gives you a tension free environment to work in since someone planning to file a law suit against you would think hard before doing it because of the distance and even if someone does there are many hindrances to it.
Last but not the least another advantage of incorporation is that the life of an incorporated company is much longer than that of a partnership or proprietorship company, because its life does not depend on you or your partners. The legend of the company continues, even in your absence!
Procedures For Incorporation In UAE are both simple and counter intuitive at the same time. The UAE, as other Gulf Cooperation Council [GCC] countries move to a logic that is different from that of the Western based company law systems!
resources for incorporation. Which One Should You Choose? An Easy Guide To Resources For Incorporation That Are Exactly Right For YOU.
The costs of a small incorporation are insignificant compared to the wealth you will protect! And you can even think about incorporation offshore, regardless of your size.
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