Top 5 Countries for Company Incorporation

More often than not, having an offshore company or corporation does not mean that your business has the best reputation. Common knowledge is that’s it’s a cover up for laundering and hiding money. Little do these people know, almost all businesses and corporations that are set up abroad are actually legal and legitimate. As a matter of fact, there are lots of perks and advantages that await those who are willing to incorporate their business in another country like lower taxes, government grants, and more.

So if you’re interested in incorporating your business in a country other than your homeland, there’s just one question left: ‘Where should I incorporate?” Because for the most part, even though there’s a whole lot of benefits that await you, there are more factors you’d have to consider – tax implications, residency requirements, manpower stipulations, legal process, and timing, among others. Hence, the first and biggest challenge you’d face is selecting which country is best to grow your business.

So here it is, to make your decision-making process easier, we give you 5 of the best countries you should really consider if you’re really determined to incorporate your business:

(5)  Panama

This country has a safe, affordable, open, and stable economy that uses the US dollar as its currency. The biggest perk you’ll get from incorporating your business in Panama is it being a global banking haven. As a matter of fact, there are over 70 local and international banks in Panama that provide business confidentiality and anonymity.

Moreover, Panama is a tax haven. Foreign investors and businessmen are practically enticed to incorporate their business there because as long as their business revenue isn’t sourced from within their country, no corporation tax needs to be paid. As long as your corporation is set up the right way, it won’t be liable for any kind of revenue that flows through it from anywhere else in the world.

Panama isn’t a country without controversies surrounding it, though. In April 2016, Panama has made headlines after the leakage of the Panama Papers which revealed the offshore financial secrets of many of the world’s richest and most powerful people. The leakage has sparked the biggest investigation in the history of journalism and it has led to protests, resignations, arrests and fierce debates around the world.

Regardless of this controversy, Panama is still country that generally offers competitive corporation fees and no required paid-in capital. Another bonus is that there is no statutory requirement to hold annual general meetings.

(4)  Sweden

Sweden is ranked no. 5 by the US News’ Best Countries to Headquarter a Corporation Report. This country is not only famous amongst investors and businessmen because Swedes are popular for being the most generous people in the world, but also because its government has very transparent business practices.

Corporations set up in Sweden pay an income tax rate of 22% which already includes federal, state, and local taxes. Currently, these businesses benefit from the lower tax rates, easy access to capital, highly advanced infrastructure, developed transportation network. They have a large number of available workforce that is simply impressive for being educated, aggressive, transparent, and highly accountable.

If you’re planning on incorporating a new business, then you can easily choose from a wide range successful industries in Sweden like the clothing, furniture, pharmaceutical, and communication industries. Just think H&M and Ikea. Well, these two are just examples of successful Sweden-based companies that have now gained popularity all over the world.

(3)  Belize

Because this country provides investors a simple and efficient solutions and benefits, it is now one of the increasingly popular locations for an offshore corporation. In a nutshell, Belize provides businessmen with lots of benefits that include quick and easy incorporation, budget-friendly annual fees, and high level of business privacy protection.

Like the Panama, Belize is also a tax haven for foreign investors. Businessmen are exempted from paying taxes when they transfer their corporate and financial assets. Plus, offshore incorporations are saved from paying local taxes like capital gains, income, dividend and stamp duty taxes as they have numerous taxation agreements with other countries like the UK, Austria, Mexico, Poland, and South Africa.

Are you worried about the minimum paid up capital? Well, you shouldn’t be; as there is no such thing in Belize. The annual costs to maintain a foreign corporation in Belize are very low because there’s really no requirement to file tax returns and there’s no control on foreign exchange.

(2)  Switzerland

Switzerland has just been ranked as the Top 1 Best Country to Headquarter a Corporation (by the US News Best Countries Report). It is not just popular for being one of the richest countries in the world, the Swiss are also well-known for their neutrality for centuries now.

This country is applauded for being one of the best places in the world to incorporate your business because of their secretive banking sector. It’s simply enticing for foreign investors as offshore entities can take advantage of their business privacy and secrecy rules.

However, this won’t be the case anymore. Come 2018, Switzerland will begin collecting financial information on bank accounts held by citizens of certain countries and share it with select countries. This comes after Switzerland signed an agreement with the Multilateral Convention on Mutual Administrative Assistance in Tax Matters in 2014 in a bid to save its status of being a global financial hub. The convention regulates information exchange between states parties on the exchange of information regarding tax matters. The automatic sharing of banking information entered into force on January 1, 2018 and this will mark the beginning of the end of the Switzerland’s reputation as a tax haven.

Despite the introduction of new banking rules in Switzerland, we can still say that it’s easier to incorporate your firm or trade in this country because of the following: well-developed legal framework, easy access to capital, educated population and manpower, and worldwide connectivity. To top all that up, foreign businesses are only required to pay 21% income tax and its government has already promised the European Union that it’ll reform its tax system by the year 2019.

(1) Singapore

When ‘most people’ talk about setting up an offshore company or incorporating a business abroad, probably the top-of-mind locations would be somewhere in Europe or Africa. But, if you’re to think really strategically and you’d want to choose a safe and stable location in Asia, Singapore is your best bet.

Being one of Asia’s four economic tigers, Singapore has shown the whole world an impressive economic growth over many years. Their efficient manufacturing and production practices, highly knowledgeable and skilled workforce, and free market innovation policies have paved the way for Singapore to become one of the best places in the world to do business in (Singapore’s conduciveness for business is also backed by the World Bank’s Doing Business Report).

And to further highlight why you should choose Singapore as the offshore location to incorporate your business, here are the benefits and advantages that await you:

  • Incorporation Procedure:  Once your company name is approved and all the documents and requirements are in order, the fastest turnaround time for incorporating your business is just a few hours within a business day. The government has no restrictions on foreign ownership and you only need at least one shareholder, one director, and one (SG-based) secretary. Also, dealing with construction permits, warehousing approvals, and utility connections, among other incorporation needs will only take you only about 26 days.
  • Corporate Taxation: The corporate tax rate is generally at 17%, but foreign companies may also take advantage of other benefits like Start-up Tax Exemption, Partial Exemption, Corporate Tax Rebates, and more. They don’t require Capital Gains Tax and Dividend Distribution Tax. All these are possible because of the 75+ tax treaties Singapore has with other nations.
  • Bank Account Requirements: Even if your business is incorporated in Singapore, you may set up your company’s bank account anywhere in the world. Plus, you only need at least SG$1 as your paid-up capital. If you’re in need of additional capital, there’s generally no need to worry as Singapore provides very easy access to capital – with all the local and international banks they have there.
  • IP Protection:  Singapore is simply the best when it comes to the protection of your Intellectual Property rights. They aren’t known for being a global hub for IP simply for nothing. This is one of the strongest driving factors why global investors are confident to set up their corporation in Singapore.
  • Other Incentives:  There are other perks that await foreign investors who are looking to incorporate their business in SG like their Global Trading Programme, Fund Management Activities, Foreign Tax Credit Pooling, Productivity and Innovation Credit, and Corporate Tax Rebate, among many others.

To sum it all up, when you choose Singapore as the location for your new corporation, it’s going to be one of your best business decisions ever. It must be your preferred business destination because of the extensive tax treaties and lower tax payables (applied with various incentives) , foreign investment friendliness, government grants, IP protection, and ease of incorporation. Not only that, because of its world-class infrastructure, strategic geographic location, and free market innovation, it’s a lot easier to start and make your company grow successfully. Simply put, Asia’s Financial Hub – Singapore, is no doubt the place to be when it comes to business.

Want business and financial experts to aid you in incorporating your business? Put a halt to your search and choose the friendly and reliable professionals here at Enterprise Assurance PAC. Whatever your company goals are, we are most definitely eager to help you fulfill them. So call us or click the button below.