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    Offshore Legal Advice

    Incorporate Offshore in Panama - Offshore Corporations- Legal Solutions-We are specialists in Commercial Laws, Corporations, Foundations, E-commerce, Taxes, Real Estate, Bank Accounts, International Outsourcing and Investment Legal Advice. We develop offshore investment, solutions and services, in different reliable jurisdictions around the world specially in Panama.
     

     
     
     
     

    Frequent Asked Question FAQ
    by Offshore Legal Support Inc.

    - What would be the factors that I need to consider, in order to find a good offshore or low tax jurisdiction?


    - There are some general points to be considered:

    Politically stable jurisdiction: How do we realize that? we need to make some research (news, governement sites, qualification NGOs, advisor, etc).
    Banking and Anonymity Laws. Probably you will need a lawyer in the onshore country, as well it is neccesary find out about double tax treaties, and other kind of regulatory (black lists, etc)
    Adequate communications system (airports, internet providers, satelite, etc)
    No exchange control
    Banking facilities such as electronic wire transfer.
    Statutory compliance requirements.
    The most common cases depending of the onshore countries:

    Uk Nations
    Jersey
    Gibraltar
    Isle of Man


    Latinoamerican
    Panama
    Costa Rica
    Bahamas
    British Virgin Islands

    French Nationals
    Switzerland
    Monaco
    Liechtenstein
    Gibraltar


    USA Nationals
    Bahamas
    Delaware
    Dutch Nationals
    Netherland Antilles
    Aruba
    Spain Nationals
    Costa Rica
    Panama
    Belize
    Gibraltar
    Switzerland
    Hong Kong Nationals
    Panama
    BVI
    German Nationals
    Luxembourg
    Information given is specific to the countries of origin concerned but often applies more generally. Please contact us for any specific advice.


    - How do I open an offshore bank account?

    - The requirements will depends of the jurisdiction, it will be required to some specific information:

    Signature Card
    Notarized specimen signatures
    Notarized copy of passport
    Bank references
    Utility bill/s showing residential address.
    Some financial institution will require more documents such as commercial references, or the personal presentation of the checking account signer, it will depends, we strongly recommend this one alternative.


    -What sort of return can I expect on my savings?
    - The rate of return that you can expect on your savings depends on several factors. The interest which you will accrue depends on the amount invested, the length of time for which it is invested, and the individual institution and jurisdiction.

    For example in Panama Certificate Deposits (CD) generates a rate of 4 up to 7% depending of the amount, time and bank.


    - How do I deposit and get access to my money?
    - There are many ways to get access to your money. It can be done by post, courier, fax, telephone, over the internet. In order to make a deposit, wire transfer wil be the best solution, either way we can introduce as agent deposit to your account, depending of the amount. If you have transferred all the capital you want offshore, and are not still in the process of transferring funds, by far the most convenient way to access your savings is by using an offshore credit card.

    Although offshore credit cards have been used legitimately for many years, onshore tax authorities - particularly in the United States - have in recent years subjected this payment form to some scrutiny, in the hopes of flushing out those using the cards to evade their tax liabilities. Initiatives such as the US Offshore Voluntary Compliance Initiative have had some success in this area.


    - How does an offshore credit card work?

    - In a great many cases, an offshore card can usually be applied for at the same time that the account is opened. The majority can be used both to withdraw money from ATM machines worldwide and to pay merchants, in much the same way as an onshore card.

    Where onshore and offshore cards differ, however, is that the latter are, for the most part 'secured', which means that you are required to provide a security deposit with your application, and you do not have to undergo a credit check. The deposit required depends upon the desired credit line, but as a general rule, usually ranges from between 125% to 200% of the credit line requested. Many cards offer additional benefits such as insurance, and card/cash replacement.


    What is the difference between a secured and an unsecured offshore credit card?

    - Usually a significant amount of your hard-earned money down the drain! The majority of the offers you will find, promising you an 'anonymous, unsecured and 100% approved' credit card fall firmly into the too good to be true camp! Drawn by the promise of complete anonymity, the 'low' application fee, and the absence of security deposit, the unwary investor eagerly remits his initial administration fee, and in the majority of cases, this is the last he hears of it. Very rarely do reputable institutions offer unsecured credit cards, and then only to well known clients with substantial assets.

    As the saying goes: 'You get what you pay for' (or rather, you don't get what you don't pay for!) Unless you fall into the above category, you would be wise to ignore the pitches of unsecured offshore credit card promoters, and resign yourself to the idea of providing a security deposit in exchange for a genuine and legitimate offshore card.


    - Is an offshore credit card expensive?

    - There are additional administrative and transactional costs to bear in mind, and charges for services such as use of ATM machines can be quite high. The rate of return on your security deposit will also be significantly lower than could be expected for other types of offshore investment. For this reason, offshore credit cards may not be right for everyone, and it is a decision which needs to be made based on the size of your investment, and personal situation.


    - What is an offshore debit card?
    - An offshore debit card provides you with the option of accessing savings held in an offshore account in much the same way as an onshore card would. A note of caution, however: obviously, an offshore debit card requires you to transfer funds to your chosen jurisdiction for 'safekeeping'. Choose the location carefully, to avoid communication/logistical difficulties later on.


    Why might an offshore investment be superior to an onshore investment?
    - The first answer, is, because it is more lightly regulated, meaning that the behaviour of the offshore investment provider, whether he be a banker, fund manager, trustee or stock-broker, is freer than it could be in a more regulated environment. Any regulator in a high-tax country will immediately say, oh, of course, if it's unregulated, then it is riskier. Well, they would say that, wouldn't they?


    - Who can benfit from offshore investment?
    - Anyone can benefit from the greater returns to be derived from offshore investments simply by choosing to invest offshore rather than onshore. But to benefit from the low individual taxation regimes available offshore, one of two things has to be true: either the individual must have residence offshore, or, for a resident in a high-tax area, there must be an offshore structure which distances offshore gains from the onshore tax net.


    - How much money do I need to invest offshore?
    - There is no absolute low limit, but the extra costs of taking advice, opening new bank acocunts, phone communication at a distance, etc, etc mean that offshore investment is unlikely to be worthwhile for less than say $25,000. Still, costs are coming down all the time because of the Internet. Offshore banks will take deposits down to $1,000, but for a personalised 'private banking' service, you will need to deposit $100,000 or more.


    - Should I use more than one offshore centre?

    - Different jurisdictions have different advantages. Depending on your agenda, you may find it useful to use two, three, four, or even five different jurisdictions in your offshore structure. Using two or three jurisdictions in an average offshore structure is very common for substantial offshore investors - one for the corporations, one for the trust, and one for the bank account. This three-level arrangement allows your offshore structure to take advantage of the best laws of each country and provides the maximum level of privacy.


    - Is it easy to dissolve an offshore fund structure?
    - Most offshore structures can be revoked or dissolved very easily. Either the corporate documents or the offshore jurisdiction's corporate or trust laws should specify the dissolution procedure. Dissolving a trust usually costs no more than a small filing fee or a few hours of a lawyer's time. If it would be costly to dissolve a given structure, you can simply remove all the assets from the structure, so it has zero value. You can then leave the empty structure to be stricken from the jurisdiction's register - a cost-effective way to eliminate it. Obviously it would be wise to check dissolution procedures before entering into any offshore engagements.


    - What is a trust?
    - A trust works by taking assets out of the ownership of the person establishing ('settling') the trust and putting them into the hands of a trustee. An offshore trust is simply one based in an offshore jurisdiction and its profits are usually not taxable there. The trustee normally follows the wishes of the settlor. Trusts, which are based in 600-year old English common law, have been in common use for offshore asset protection for nearly 100 years. Unfortunately, the high-tax countries have therefore had plenty of time to defend themselves against trusts, and by now their usefulness has been severely compromised for the residents of many high-tax countries.


    - What is an asset protection trust?
    - A trust designed to accomplish a number of estate planning goals of its settlor, before and after death, including planning for the preservation of the settlor's estate from a variety of risks which would threaten to dissipate the estate if one or more of the risks materialised. An APT is typically established in a jurisdiction other than the settlor's home country.


    - Why are investments regulated more than other types of purchase?

    - Regulation covers the avoidance of fraud (to protect investors from their own ignorance or cupidity), the avoidance of money-laundering (nothing to do with bona fide investors) and has prudential aspects, ie it tries to prevent investment managers from making risky investments that could lead to loss for investors. Regulators believe that people's savings are so important they must be given special protection.


    - What is money-laundering?
    - The conversion of 'illegal' money into 'legal' money. Thus, a drug-runner who walks into a Caribbean bank with $1m, opens an account, and the next day transfers the money into a Swiss bank account where he invests it into Nestle shares has 'laundered' the money successfully. Nowadays banks are much more careful about accepting large sums of unaccountable cash.


    - Is it legal for me to make offshore investments?
    - This depends first on where you live. Many countries, including the US, Canada, the UK, France and some other EU countries, make it illegal for offshore investment providers to advertise their products domestically. Despite this, generally speaking it is not illegal for you to make offshore investments (although the US is particularly restrictive). You must check carefully with local advisers as to your rights. It is illegal in almost all jurisdictions for you not to declare the income or gains from offshore investments to your local tax authorities, and in those very few countries with remaining capital controls, to the monetary authority.


    - What is meant by the terms 'domicile' and 'resident'?
    - 'Domicile' normally relates to the country or state which an individual regards as their permanent/ultimate home location. A person's domicile is established at birth and this remains until an individual resettles with the firm intention of remaining in that new location.

    'Residence' is normally determined by an individual's status at a particular time. The rules vary from country to country, but in many cases presence in a country for more than 183 days in any one year is enough to constitute residence for tax purposes.


    - What is withholding tax?
    - When a dividend (or royalties or interest) is paid internationally, the country from which the payment is made usually taxes the payment as it leaves, by 'withholding' a proportion of it, usually between 10% and 30%. If there is a double tax treaty between the two countries concerned, it is often possible to reduce the tax, or to reclaim some or all of the money. Some receiving countries allow the withheld tax to be set off against domestic tax liabilities.


    - What is a double taxation treaty?
    - An agreement between two countries intended to relieve persons who would otherwise be subject to tax in both countries from being taxed twice in respect of the same transactions
    or events. By and large, most offshore jurisdictions do not have double taxation treaties, since they don't have much local taxation. Offshore jurisdictions which do have double tax treaties usually cannot use them to benefit investors receiving complete local tax exemption.


    Why do people expatriate?
    - For various reasons. Some people expatriate purely for financial reasons, or because of displeasure with government policies, while others are obliged to leave their country of residence by the nature of their job, or the service that they provide. The duration of the overseas stay, the destination(s) and surrounding circumstances can differ greatly, but the uniting factor is that in the majority of cases being an expat can be financially advantageous as well as culturally enriching.


    - What are the banking/investment options open to me as an expatriate?
    -As an expatriate, you really have your pick of the investment arena.

    A lot depends on the tax regime in your home country, but assuming that you are going to be non-resident for the duration of your absence, then nationals of most countries are in an ideal position, as expatriates, to take advantage of offshore financial services in a tax-efficient way.

    In addition, many high tax countries offer attractive investment opportunities and tax breaks for non-resident individuals and entities.

    There are many different structures and services of especial interest to expatriates, so the determining factors need only be the size of your pocket and your inclinations!

    - What should I do about banking while I am overseas?

    - Whatever your financial circumstances, as an expat you would be advised to examine the possibility of opening an offshore bank account, in order to take advantage of the tax efficiency and relatively enhanced confidentiality that this provides. No tax is payable on interest arising from money held in an offshore bank account (unless the EU Savings Tax Directive applies), so even if you are just looking for somewhere to receive funds remitted from home, or have your salary paid into, this has to be a plus.

    There are various types of account available to suit your means and needs. These include instant access accounts with credit/debit card facilities, fixed term deposit accounts with tiered rates of interest, and fixed and variable rate accounts.

    In most cases it would also be useful to set up a bank account in your destination country (where you will be living or working most of the time), from the point of view of conducting day-to-day transactions more easily. You could arrange with your employer to have part of your salary or expenses paid into your offshore account, and part into the local account.

    Offshore accounts can usually be in a range of hard currencies, but the local account may have to be in the local currency: having two accounts means that if the value of the local currency fluctuates greatly, or if you are taxed locally on money received, then you are protected to a certain extent.


    - Would offshore fund investment be suitable for me as an expatriate?
    - It would be ideal! Fund investment means that you can choose to invest in a particular class of assets without having to examine the characteristics of each asset individually, and if you choose to invest in an offshore mutual fund, the responsibility for the management, maintenance and administration is taken by the promoter, manager and custodian of the fund.

    There are various options, ranging from the ultra safe to the very aggressive, but the two main categories that offshore funds can be divided into are private funds (longer term investment, usually requiring more capital, but hopefully generating greater returns) and public funds (usually open-ended, so more flexible, and requiring less capital). Always depending on your original home tax regime, many expatriates will be able to receive dividends and capital returns from an offshore fund without paying tax while they remain non-resident.


    - I'm not interested in investing, I just want somewhere to keep my money safe. What type of structure would suit me?
    - If you have substantial liquid net worth that you would like to protect during your expatriation, and afterwards, then an offshore trust may be the way to go, along with offshore bank accounts. This type of structure is more used for asset protection purposes than for tax efficiency during your lifetime, as many high tax countries (for example the US) now have legislation designed to make offshore trusts at best tax neutral. However, the asset protection advantages, and the enhanced privacy afforded by an offshore trust are useful features. Trusts are still effective as a defence against inheritance tax.

    An offshore trust basically works by transferring control of your assets away from you (the settlor) to a custodian or trustee, who will manage the trust in the best interests of the beneficiary/ies (This can also be you, or any other person, group of people, or entity that you specify). It is normal for trustees to operate the trust in accordance with the wishes of the settlor.

    There are different types of trusts for different purposes, and you need professional assistance in selecting the right type in the right jurisdiction. If your home tax regime does not yet have anti-avoidance legislation, and you hope to gain tax benefits from setting up a trust, then you will probably use a discretionary trust, in which the trustees have full control over the disposition of the trust income and assets. You can still be named as a beneficiary, however, and the trustees will still follow your wishes.


    -- What is an offshore company, and do I need one?
    - If you are going to work in a country which wants to tax your world-wide income, or if you are going to return to your home country to a world-wide taxation regime (quite likely) then an offshore company may be worth considering.

    This is another complex area in which professional help is needed, but the interpolation of a company can sometimes distance you from your income sufficiently to reduce or avoid taxation. In some countries there are plenty of rules to prevent this; but not in all, by any means.

    An offshore company can take many different forms, some of which are not of interest to the individual expatriate investor. However, if you have a large and diverse investment portfolio, or provide a professional service (for example consultancy in the engineering or finance industry), then this type of structure may be of interest to you.

    If you are engaged in providing a personal or professional service, you may be able to achieve considerable tax savings by setting up a 'personal service company'. You can contract to supply the service regardless of residence, and the fees earned can accumulate offshore while you work for a low salary in the country where you are taxed. It only works in some countries, and you may have to do something more complicated than just owning the company yourself, if it is not to be 'looked through' by the taxman.

    There are, of course, many other types of offshore company that can be formed to deal with the needs of large corporations, or expats with very specific needs, i.e. globetrotting entertainers or sportsmen.


    - How do I decide on a jurisdiction?
    - Choosing a jurisdiction that you would be happy to invest, bank, reside and work in, and possibly retire to means taking into account a lot of factors, and you will need to do your homework. However, the following information may help you to decide which jurisdictions interest you initially. First of all, the following questions must be asked of any potential investment or banking base:

    1) Is the jurisdiction politically and economically stable?
    2) Is the tax regime benign for investments?
    3) Are there any changes in prospect which may impact on your investment/savings either now, or in the future?
    4) Are the professional support services up to a good standard?
    5) Is there a good communications network in place?
    6) Is the geographical location convenient for you during your expatriation, and will it still be so when you return home, or move on to a different country? If you are expatriated to Australia, for example, you will have no problems dealing with an organisation based in Hong Kong, but tremendous problems accessing an offshore structure in the Isle of Man during business hours.

    The increasing use of the internet means that this is less of a problem than it perhaps would have been a few years ago, but unless you particularly want to conduct your business dealings in pyjamas, you would be wise to take this into account!

    So - you have found a jurisdiction that fulfils all of the above criteria. That's the decision made, then, isn't it? Not quite. Although a particular jurisdiction may be ideal for the type of investment or banking that you have chosen, if you are planning to work there in the future, or spend your twilight years there, you will need to consider many other factors, for example the tax liabilities of resident foreign nationals there, how easy it is to obtain a work or residence permit, the standard of infrastructure and services, and the general lifestyle.

    Below are summaries of much of this information for some of the main offshore jurisdictions, in order to make your life just that little bit easier…


    - What is private banking?
    - The expression 'private banking' is nowadays more to be seen as a gateway into investment management in the broader sense than as offering a confidential, almost family relationship with a man to whom you entrust your money. Those relationships still exist in the traditional places, but they apply more to extremely rich people than to moderately wealthy or well-off people who want more personalised treatment than they can get from their high street branch, or their regional 'personal banker'.

    In InvestorsOffshore.com, 'private banking' is taken to mean investment management offered on a personalised basis by a bank to an individual (or indeed his company) with disposable wealth of more than $100,000. 'Private banking' is obviously not synonymous with 'offshore', but the costs of a personalised relationship begin to be worthwhile at the $100,000 level in the light of the superior gains to be realised from offshore investment.


    - How does a private banker get rewarded?
    - Depositing money with a bank is reward enough, of course, whether into the bank or into one of its financial products, but private banking when it has an advisory nature and is not accompanied by lending or borrowing may be fee-based. The level of the fees is highly variable: they will be lower if the bank will get the benefit from time to time of being able to offer bridging finance, or of holding large amounts in transit etc, or if it can hope for more substantial involvement with you in future. If the relationship is purely between financial adviser and client, then the fees may be substantial.


    - What is Offshore Asset Protection, and do I need it?
    - Asset Protection. Does exactly what it says on the tin. If you have a substantial liquid net worth, this may be an aspect of offshore private banking which interests you. Especially in the USA, people are turning to offshore asset protection as a way of safeguarding their savings by distancing themselves from their assets in the eyes of the law, although such moves have not gone unchallenged in the courts.

    Offshore asset protection can be achieved in a number of ways, for example the establishment of trusts, IBCs (International Business Corporations), foundations, partnerships, and other legal entities.

    There is, however, absolutely no point in attempting to set up an offshore structure for the purposes of asset protection during, or immediately before action is taken against you, as fraudulent conveyance statutes will mean that if your intention is seen to be to defraud a legitimate creditor, your structure will afford little or no protection.


    - Is private banking private?
    - In most countries one of the terms of the relationship between banker and customer is that the banker will keep the customer's affairs secret. Staff members are normally required to sign a declaration to this effect. Where numbered accounts are used their purpose is to limit the number
    of persons who know the identity of the client. In certain countries (e.g. Switzerland and the Cayman Islands) specific legislation makes breaches of bank secrecy subject to criminal law sanctions.

    However, in all legal systems (including Switzerland) there are specific cases where the duty of secrecy of a banker is overridden by local legislation or international treaties, eg where fraud, money laundering and drugs are involved.


    - What is the situation regarding exchange of information between countries?
    - The recommendations of the FATF and the initiatives of the G7 and EU countries, and the OECD have thrown bank secrecy policy into turmoil. These recommendations have been targeted at jurisdictions which the FATF considered to have 'serious systemic problems with money laundering controls' and for those who failed to review their practices and make reforms, the adoption of 'counter measures' was darkly hinted at. The recommendations hinged on creating greater transparency during the process of offshore investment/banking, and the reporting and exchange of information regarding transactions deemed to be unusual.

    In 2002, the IRS was awarded the right to demand the records of American Express and MasterCard transactions for customers who hold cards issued through Antigua, the Bahamas and the Cayman Islands. This came as a result of the testimony of John Mathewson, a former Cayman Islands banker who revealed that the cards could be used for tax evasion purposes.

    The implementation of Qualified Intermediary legislation in January 2001 also affected those with American source income, meaning that financial institutions in countries which don't obtain approval from the IRS come under heavy pressure to divulge information about their customers to the IRS, and to tax US source income at the full rate in many cases, even when a lower rate is due.


    - How will this affect me?
    - With regards to the FATF recommendations, many of the 'blacklisted jurisdictions' have made moves towards greater transparency. You would be wise to ascertain and monitor the status of your chosen jurisdiction.

    From the point of view of a US citizen or expat seeking confidentiality for legitimate reasons, the wisdom of seeking a confidential banking relationship with an institution with a corporate presence in the US should also be carefully considered, as the IRS was able to gain access to the transaction records of AmEx and MasterCard customers via the Miami based sections of the companies' Caribbean operations.



    - What is the Savings Tax Directive?
    - The European Union Savings Tax Directive (STD), which came into effect on 1st July, 2005, in fact forms merely one part of a major tax reform package launched by the European Commission in 1997. As originally drafted, the STD aimed at a uniform 'information exchange' regime to apply across the Union, with all countries agreeing to report interest on savings paid to the citizens of other Member States to those States' tax authorities.

    Because of resistance from EU Member States with strong traditions of banking secrecy, the Commission had to allow Austria, Luxembourg and Belgium to apply a withholding tax (at 15%) until 2009. Many of the UK's offshore financial centres have been forced to join the STD, along with the Netherlands Antilles, Aruba and some European centres (Andorra, Monaco, Liechtenstein and San Marino). Most of these places have also taken the withholding tax route, as will Switzerland, which was the hardest nut for the EU to crack.

    The STD applies to many types of return on savings instruments, all loosely described as interest, when received by individuals, but does not affect interest paid to companies. Under the information exchange system, the identity of recipients will be known to their home tax authorities; when tax is withheld, the identity of the recipient will not be reported, thus preserving confidentiality.

    - Who runs an investment fund?
    - Three distinct functions exist: the promoter is the person or company who established the fund and markets it; the manager is the person or company who runs it from day to day, and the custodian is the person or company who holds the investment assets on behalf of the subscribers. In some jurisdictions, these functions have to be exercised by separate bodies, but in many, two or more can be combined. All three functions are rewarded with fees, usually based on the value of the fund, but sometimes being success-based.


    What is an investment fund?
    - An investment fund is a pool of money contributed by a small or large number of subscribers, unit-holders or shareholders, which is invested and administered on their behalf. They share the proceeds (or losses) in proportion to their subscriptions after deduction of costs.


    - What is a mutual fund?
    - A mutual fund (a unit trust in the UK) is an investment fund divided into units (equivalent to shares) which can be bought from and sold back to the manager of the fund, but which are not traded as such. The value of the fund NAV (net asset value) per unit is calculated frequently. Many countries have favourable tax regimes for mutual funds, to encourage saving.


    - What is an open-ended investment fund?
    - One which has no pre-determined closing date. Most publicly-marketed investment and mutual funds are open-ended.


    - What is an closed-end investment fund?
    - One with a pre-determined closing date, on which the fund's assets must be realised and the proceeds distributed back to the subscribers. Closed-end funds are normally used by groups of private investors, often working in 'limited partnerships' for tax reasons.


    - What is an offshore investment fund?
    - One which is based in an offshore jurisdiction (although the term is often used, perhaps incorrectly, to describe a fund which is based outside a particular high-tax country). An offshore investment fund may have the problem that it cannot market into some important high-tax countries unless its local supervisory and regulatory regime is 'recognised' by high-tax countries as being up to their standards. Broadly speaking, this means that if you see an offshore fund being marketed in a high-tax country, its investment behaviour is probably quite constrained, and this may limit its ability to achieve high returns, in the interests of protecting investors.


    - What types of offshore fund are there?
    - Offshore funds come in many varieties, even more than onshore funds (those in high-tax countries) which are often limited by local regulation to less volatile types of investment. Thus, there are offshore bond funds, equity funds, sectoral funds, emerging-market funds, money-market funds, hedge funds, property funds, income funds, capital funds - and more.

    What is an offshore equity?
    - An offshore equity is one that is listed on a stock exchange in an offshore (= low-tax) jurisdiction. Usually there are no withholding taxes on dividends paid out, and very low local taxation of corporate profits. An offshore equity brokerage is simply one that is based offshore, and allows you to buy regular 'onshore' equities from an offshore base. This won't directly help you to escape withholding taxes, but it may help with national stamp duties and capital gains tax, as well as preserving confidentiality.


    - What is a 'recognised' exchange?
    - If a stock exchange has a regulatory and supervisory regime which is up to the standards of established stock exchanges in high-tax (OECD) countries, then it may be 'recognised' by the authorities in some or all OECD countries. This means that securities listed on it can be offered for sale in the high-tax countries concerned, and in particular can be bought by mutual funds within high-tax country regimes.


    - How do offshore equity brokers' rates compare with other discount brokers?
    - Rates are usually competitive against both broker-assisted and Internet brokers, and extremely attractive compared to traditional full service brokers.


    - How do I deposit securities into an offshore brokerage account?
    - Endorse your securities certificate exactly as it appears on the face of the certificate. Write the number of your offshore brokerage account account number on the upper left face of the certificate. On the back of the certificate between "appoint and attorney" write the name of your offshore brokerage's settlement agent (obtainable from the brokerage) which ensures that the certificate can be negotiated only by the agent. Then send the certificate to your brokerage by a secure route, along with your written instructions.


    - What type of accounts can I open with an offshore equity brokerage?
    - Individual and Joint Accounts (cash or margin)
    Corporate and Partnership accounts.
    Estate and Trust accounts.
    Investment Club accounts.

    An individual account is appropriate for investors who will be the sole owner and authorized manager of their investments.

    If your account will be owned by two or more persons, you may want to open a joint account. A joint account will enable each owner to trade in the account and to receive income, proceeds, or securities from the account.

    To open a Corporate or Partnership account you must complete a paper application and provide a corporate or partnership resolution.

    Trust or Estate accounts require legal documentation in addition to account applications before they can be established.

    To establish an investment club account, for a group of individuals trading under one entity name, you must fill out a paper application and provide an investment club agreement.


    - Can I use the Internet to buy offshore equities?
    - The Internet is becoming an excellent tool for international and offshore investors. If the online investment site is properly structured (with SSL encryption technology and digital certificates, which are common features), it should be both safe and efficient. More and more brokerage firms and exchanges are moving to Internet-based clearing services and online financial services. The Internet allows you to manage your offshore portfolio with the click of a button, from the comfort of your home.

    This has substantially reduced physical barriers to international investing and allows investors to stay informed and make profitable investment decisions. Offshore investors can also use the Internet to develop their knowledge and understanding of foreign jurisdictions, investment products, and the investing process.

    - Can I use the Internet to buy offshore equities?
    - The Internet is becoming an excellent tool for international and offshore investors. If the online investment site is properly structured (with SSL encryption technology and digital certificates, which are common features), it should be both safe and efficient. More and more brokerage firms and exchanges are moving to Internet-based clearing services and online financial services. The Internet allows you to manage your offshore portfolio with the click of a button, from the comfort of your home.

    This has substantially reduced physical barriers to international investing and allows investors to stay informed and make profitable investment decisions. Offshore investors can also use the Internet to develop their knowledge and understanding of foreign jurisdictions, investment products, and the investing process.


    - What is the difference between a corporation, foundation or trust?

    For banking purposes, there is very little difference. All entities come with everything you need to open bank or brokerage accounts. Generally, corporations are used for profit ventures involving business activity such as securities trading, banking, international trade, ownership of assets etc.. Most of our clients establish corporations. Foundations are generally used for non-profit activities such as charities, receiving or giving donations, grants, etc., but can also be used for holding purposes such as holding ownership of corporations or any other type of asset. Most of our clients use Foundations to hold ownership of their corporations for additional confidentiality and asset protection. Trusts are generally used for holding purposes such as owning corporations, or holding assets such as real estate. Very few of our clients establish trusts due to the extensive offshore trust reporting rules that exist in many of our clients home countries around the world (USA, Canada, UK, Australia, New Zealand, etc.). As a result of the declining popularity of offshore trusts, we have refrained from selling or recommending offshore Trusts at this time. However, these are simply general guidelines for what each type of entity was initially created for and these guidelines do not have to be strictly adhered to as there is no authority in Panama that enforces the uses of each type of entity.

    - Can I use my entity (Corporation or Foundation) to hold ownership of real estate property in my home country?
    - The Internet is becoming an excellent tool for international and offshore investors. If the online investment site is properly structured (with SSL encryption technology and digital certificates, which are common features), it should be both safe and efficient. More and more brokerage firms and exchanges are moving to Internet-based clearing services and online financial services. The Internet allows you to manage your offshore portfolio with the click of a button, from the comfort of your home.

    This has substantially reduced physical barriers to international investing and allows investors to stay informed and make profitable investment decisions. Offshore investors can also use the Internet to develop their knowledge and understanding of foreign jurisdictions, investment products, and the investing process.


    - Can I use my entity (Corporation or Foundation) to hold ownership of real estate property in my home country?
    - That depends on the country you are located in and the real estate ownership rules in that country. Some countries have extensive reporting requirements, additional property taxes, and all kinds of red tape to go through when titling real estate in the name of a foreign entity. For example, we do not recommend that you use Panama corporations, foundations, or trusts to hold ownership of real estate in the USA due to the extensive reporting requirements, additional property taxes, etc. imposed under the FIRPTA (Foreign Investment in Real Property Tax Act). If you are interested in asset protection for domestic real estate, then we generally recommend that you title the real estate in the name of a domestic entity (such as a domestic corporation, LLC, or trust) and then have the domestic entity owned by an offshore entity, such as an offshore corporation or foundation.


    - Is there any requirement to file Panama tax returns, keep books for the corporation, have an accountant, etc.?
    - That depends on the country you are located in and the real estate ownership rules in that country. Some countries have extensive reporting requirements, additional property taxes, and all kinds of red tape to go through when titling real estate in the name of a foreign entity. For example, we do not recommend that you use Panama corporations, foundations, or trusts to hold ownership of real estate in the USA due to the extensive reporting requirements, additional property taxes, etc. imposed under the FIRPTA (Foreign Investment in Real Property Tax Act). If you are interested in asset protection for domestic real estate, then we generally recommend that you title the real estate in the name of a domestic entity (such as a domestic corporation, LLC, or trust) and then have the domestic entity owned by an offshore entity, such as an offshore corporation or foundation.


    - Can I use my entity (Corporation or Foundation) to hold ownership of real estate property in my home country?
    - Yes. Offshore companies must file an annual tax declaration stating that they are "offshore companies", so they don't pay tax in Panama. Panama offshore companies earning money outside of Panama don't pay income taxes in Panama. It is not a requirement to keep books for the corporation or have an accountant, however, we recommend that you do keep your own internal (private) books for accounting purposes.


    - What are nominee directors and nominee signatories?
    - Nominee directors (or nominee council members) are directors that our law firm appoints for you. Each corporation or foundation must have 3 directors appointed when the entity is registered in the public registry of Panama. The directors names and passport numbers are on the public deed of the corporation (or foundation) and this information is publicly available. In many cases, our clients prefer to NOT be appointed as directors on the offshore entities due to either privacy reasons, or foreign public directorship reporting rules in their home countries. When we appoint nominee directors on our clients entities, we provide our clients with pre-signed, undated letters of resignation from each director so they can replace the directors at any time. The nominee directors we appoint are only there to fill in the blanks at the public registry and they have no authority over the entity for any kind of decision making.

    Nominee signatories are signatories that our law firm appoints for you on your corporate accounts. In many cases, our clients prefer to not be the signatory on the corporate accounts due to either privacy reasons or foreign account signing reporting rules in their home countries. When we appoint nominee signatories on our clients corporate accounts, we charge an annual fee of US$1000 (or 1%, whichever is more) for this service. When our clients want a transaction done on their corporate account, they would simply contact a designated service representative within our firm, and make the request, then we forward the request to the bank or broker to execute the transaction.


    - Can I transfer securities to the corporate brokerage account that you set up for my corporation?
    - Yes, once the corporate brokerage account is set up, we will provide you with DTC instructions to transfer the securities to the corporate brokerage account. All you need to do is instruct your broker to DTC transfer the securities to the instructions we provide. If you have stock that is in physical certificate form, you must either deposit the stock in a brokerage account and DTC it to the corporate brokerage account, or have the stock certificates re-issued in the corporations name, then send the certificates to the brokerage firm along with the stock powers and the brokerage firm will deposit them into the corporate brokerage account.


    Offshore Panama

    - What is the cost of living in Panama?
    -One of the really great things about Panama is that you can live a really comfortable and modern life at a very low cost. You can find comfortable 1 bedroom furnished apartments in the $500-600 pm price range although they wont be the latest model. For $800-1000 pm you can get a really nice luxury apartment in a new building.

    There are tons of great very modern office space available right now. If you need an office you are really spoilt for choice. You should be able to get a smallish office for $300-500.

    Internet is good and plenty but it will cost you a little bit more than you are used to. Not outrageously though. The lowest rates start often at around $15pm and go up to around $120pm. If you are running this to your house get the personal account. There are both ADSL, Cable Modem and Wireless services available.

    Food is cheap by any standards both in markets and restaurants. You can easily find a decent steak for $5-7 in a restaurant. See this post about average meal cost for more.


    - What is the most important Immigration facts?
    -


    -How long does it take to incorporate a Panama Offshore Company?
    -Our Firm can have the corporate documents ready to be sent in approximately four labour days.


    - Is it necessary to come personally to Panama to incorporate the Company?
    - No. it is not necessary to be present in Panama for incorporating a Panama Offshore Company.


    - Is it necessary to pay or deposit the Authorized or Registered Capital of US$10,000?
    - No. this is just a nominal figure. It is not required for this Authorized capital to be paid in any of its parts.


    - How long does it takes to open a corporate bank account in Panama?
    -If all the documents and references provided to the bank are in order, the account opening procedure can take approximately 4 weeks. After the personal interview with the bank, our Firm will complete and finish the bank account procedures.


    -How do I control the corporation if nominee directors are used?
    -In these cases you will require a General Power of Attorney in order to grant you the power to act individually in behalf the corporation, this documents is usually issued in a Private Separate document for your privacy


    - What is the Board of Directors?
    -The management, administration and business of the Corporation is administered and conducted by a Board of Directors, composed of at least three members of full age, of any nationality, usually directors are as well officers of the corporation (president, secretary and treasurer)


    -What if we don't want our names to be registered in the Public Registry?
    -Anonymity we can provided by us with reliable nominee directors



    - Is the shareholders information registered at the Panama Public Registry?
    -No, it's not. Share Certificates are issued through private documents.


    - Will our customer be able to check our corporation registered in the internet by any authority?
    - Yes, you will be able to check your corporation in the Public Register site.


    - Will we have the control of the corporation?
    - Yes, you will be able to change even the resident agent, because you will control every single shares and you will received a power of attorney. that's means you will control as well the meeting of the board.


    -Do I have to pay taxes for the Interest of a bank account the corporation has in Panama?
    No, only income or profits generated within the geographic territory of Panama are subject to tax. Any profit obtained from activities outside of Panama, such as transfers or acquisition of securities, management of bank accounts and investments, the transfer or sale of real property or chattels, and the dividends received from companies operating abroad, will be exonerated from Panamanian taxes.

    - How much are the second year costs and annual payments for the corporation?
    -The only payment that Panama Corporations are required to pay annually is the Annual Franchise Tax of US$ 300.00. Our fees for being the Resident Agent of the Corporations are US$ 150.00 per year.


    Do I have to present a Tax return to Panama Authorities?
    -No if the corporation activities are performed outside the Panama Territory.


    - Is it possible to issue bearer share certificates?
    -Yes, Bearer Shares are legal in the Panama legal system.


    What is the difference between bearer share certificates and nominate share certificates?
    -The main difference is that in bearer shares the owner is the person that physically holds and has the possession of the shares. In nominate form, the shares clearly states who is the owner.


    - Bearer or nominative share certificates, which one do you recommend?
    -It really depends in each case; bearer shares are more flexible, taking into consideration that they are easily transferable. However, nominate shares provide more security. It is important to note that if you plan to open a bank account in behalf the corporation, many banks prefer nominate shares instead of bearer shares, nevertheless, this will depend on each bank policies. As well you can issue nominative shares to a different entity control 100% by you, this will be setting a private interest foundation controlled by you as an administrator and beneficiaries.


    - Are the shareholders the maximum authority of the corporation?
    -Correct, shareholders are the maximum authority of the corporation, they are above the Directors of the company.


    - Do you provide bank introduction services in order to open a bank account in Panama?
    -Our Firm provides bank introduction services in order to establish corporate bank account in Panama with high rated banks. These services are only for companies incorporated trough our Firm.


    Do I have to present a Tax return to Panama Authorities?
    -No if the corporation activities are performed outside the Panama Territory.


    - Is it possible to issue bearer share certificates?
    -Yes, Bearer Shares are legal in the Panama legal system.

     

     

     
     
       
  • Frequented Asked Questions
  • Offshore Tips
  • Due Diliengence and KYC Outsourcing
  • Offshore Jurisdictions
  • Offshore in Panama
  • Real Estate in Panama
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    Panama Corporations and LLC, Panama Companies

    Corporation ( Panamá Offshore Companies)

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    Private Interest Foundation

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    Financial Offshore Licenses

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    Offshore Accounting Services.

     

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    Relocation Services

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    Offshore Mail Forwading

     

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    Investment Opportunities in Panama

     

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    Did you Know?...

    De acuerdo a los expertos, la banca offshore controla

    más de la mitad de la industria bancaria mundialmente.

     


     Panama Offshore Information

    Panamá es la única jurisdicción reconocida en el mundo que emite acciones al portador y a la misma vez no tiene acuerdos de colaboración impositiva con ningún país.

     


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