Benefits Of IBC’s For Tax Mitigation

An International Business Company (IBC ) can be a fantastic method to use when structuring or moving business or investments or assets offshore.

It allows the owner to buy property and investments protect the assets away from UK government taxation. IBC’s are fully legal entities and legitimate tax strategies and are often used by major companies.

In reality we in the UK pay 80% tax for every pound spent when all the various ways we are taxed on everyday things is taken into account. There are costs to setting up an IBC so it is wise to weigh the cost over benefits. The IBC needs to both save tax and protect assets whilst not being outweighed by the costs of setting it up and running the offshore entity.

What’s Involved-The Facts

IBC’s can be fully managed including accounting included and the “Company” (not you personally) files yearly accounts.
IBC’s can be set up all associated bank accounts etc about 7 days. It creates a limited company structure which separates you from your tax liability by placing the company in between.
The IBC bank account has credit cards/ internet banking, allowing money to be moved around to pay bills etc as per usual.
The company assets become ‘shares’ and are allocated to the company shareholders – ie; you & any associates / family members.
You can extract money via the cards /pin. You are the sole signatory.
The company can be held and registered in many offshore jurisdictions, but your accounts can be elsewhere. This protects the cash and assets by placing a wall between them and any tax searches. You qualify as non UK tax resident:- managed and controlled outside the UK and will pay taxes according to the jurisdiction chosen by your adviser.
The company can obtain the income and profits. CIBC is subject to 10% tax- BUT- you can claim for almost any receipt as an expense thereby lessening your tax liability.
You can carry losses forward year on year until paid off.
The company can obtain the income and profits.
In the case of a CIBC ( Cyprus IBC) it is subject to 10% tax- BUT- almost any receipt can be claimed as an expense thereby lessening the tax liability.