Other Tax Havens

Tax Havens of the World

Many different definitions of the term tax havens have been coined over the years but the essence of all the different definitions remains that - a tax haven is a place which has very low or no taxes at all. Some definitions are quite specific and recognize tax havens as countries with low taxes for foreigners. The countries which are part of the world’s tax havens began as small countries trying their utmost best to become independent of the more developed countries of the world. Some of the world’s tax havens are located in the Caribbean, Europe, the Pacific and Indian Ocean. These tax havens include Anguilla, Dominica, Belize, Nevis, the British Virgin Islands, Seychelles, Singapore, Mauritius, Vanuatu, Luxembourg, Cyprus, Gibraltar, Bahamas, Caymans Islands and the Republic of Panama among many others.

The tax havens of the world began to appear in the late nineteenth (19th) century. Today the number of tax havens around the world has grown and so has the client base. Upon inception, the most frequent customers to tax havens were the extremely wealthy who sought asset and means of increasing their capitals. Today it would seem that practically everyone with some capital or assets to protect knows of a good tax haven.

Other Tax Havens

Some of the international tax havens available today are also offshore jurisdictions and for this reason they are normally referred to as offshore tax havens. These jurisdictions provide offshore services such as the incorporation of offshore companies or International Business Companies, offshore and captive insurance, the management of investment funds, the registration of ships and vessels, the formation of offshore foundations and offshore trusts, electronic gaming, offshore banking and banking services among other services. Offshore tax havens include the jurisdictions of the Caribbean examples being Dominica, Anguilla, Bahamas, Nevis, Belize, Panama, British Virgin Islands (BVI) and the Cayman Island.

Tax Havens of the World - Advantages

The best tax havens of the world are those countries which are competent at providing clients with the following; low or zero taxes, confidentiality and privacy, strict and modern legislation which will foster and protect the growth of clients’ investments. The tax havens of the world are countries with very modern communications and technology systems in place; they are very stable countries both economically and politically, credible countries with good infrastructure and the expertise to maintain the services which will keep the tax haven competitive.

Many of the world’s best tax havens have zero taxes levied on capital gained from outside of the country by offshore companies. Capital gained from abroad is recognized as any form of income which includes interest, dividends and profits. In offshore tax havens such as Dominica and Bahamas tax exemptions is embedded in the International Business Companies Act which guarantees that such companies will receive a period of twenty (20) years tax exemptions beginning from the day of incorporation. In most of the world’s tax haven there is no capital gains tax, inheritance tax, corporate tax, income tax, gift tax, withholding tax. The tax havens with none of the above mentioned taxes are also known as pure tax havens. International Business Companies, offshore trusts and foundations are all exempted from paying Stamp Duty on transactions carried out on their behalf in pure tax havens. The only taxes paid by these offshore entities are an annual license fee which is paid to the government of the country of incorporation.

Privacy in Tax Havens of the World

Tax havens of the world provide privacy for offshore companies through legislation. The financial statements of most offshore companies’ remains private since these are not presented to any authority. The names of the beneficial owners of offshore companies, trusts, and foundations are not disclosed in some tax havens while in others the identity of these people is preserved by using nominee shareholders, directors and members when incorporating these offshore entities. In tax havens such as Dominica it is a criminal offense for anyone working directly with an offshore company to disclose information regarding the offshore entity to a third party.

Other Tax Havens - Offshore Banking

Tax havens of the world where offshore banking is carried out also have no taxes imposed on the interest gained an offshore bank account. These offshore tax havens have banking secrecy laws in place which will protect the information in offshore bank accounts. What banking secrecy inevitable does is that it prohibits bank employee, registered agents and other persons associated with offshore banks from disclosing information in offshore bank account to third parties or parties outside of the bank. Information in offshore bank accounts can only be given out with the written authorization of the bank account holder or if a court order has been given out. Unsanctioned disclosure of offshore bank account information in most tax havens in a criminal offense and is punished by incarceration and monetary fines.

The tax havens of the world help people to invest monies and protect their asset using safe and legal means.

Continue reading here: Tax Haven Dominica

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