What is an IBC and What to Consider as to IT
March 23, 2016
In case you’ve made up your mind to start your own business, you are likely to have come across the term offshore IBC. It’s an abbreviation for the International Business Company and stands for a special type of legal entities, which can be incorporated in certain jurisdictions. As a rule, IBC is tax-neutral and easy to set up and maintain. These companies are much more advantageous than local LLCs or Corporations. Check in advance if an International Business Company is the right type of a legal entity for you.
If you have an intent to do business worldwide or to protect your assets abroad, an IBC is the very option you need. IBCs are known to be the foundation stones for offshore incorporators. Though the exact regulations, benefits, tax details and costs differ in every jurisdiction. There are certain things in common for the IBC’s in different countries. However, you should check all the details while selecting a hub to register a company in.
The Fundamentals of IBCs
The government of every state is dependent on tax revenues and even offshore jurisdictions are unable to exempt all their residents and businesses from taxes. That’s why the offshore business entities are ruled by specific regulations, tailored for the situation. Most offshore hubs differentiate between fully tax-exempt companies and the local corporations, paying taxes. In Belize, for instance, an IBC should only operate overseas, without any business processes inside the country. It’s then exempt from submitting any tax reports and is not subject to taxation as the profit comes from international activity. Such an entity can be managed remotely and faces neither restrictions nor regulations characteristic for local businesses. The hub also experiences no loss from such a company from the taxation point of view as the income is generated from international operations.
The registration of IBCs is generally offered by small jurisdictions. Such enterprises support their local financial system, being an important source of income through using the services of registered agents, lawyers and banks.
For the areas with low GDPs, offshoring generates employment which would otherwise not exist. The services provided to the IBCs become an important source of income to the hubs, which would otherwise depend on tourism or export.
Setting up an offshore company, you’ll have to go through registration formalities. The process will be different in each jurisdiction, but most hubs you can find on our website offer remote registration. Find out how easy and quick the process may be.