An offshore company is a corporation or other type of legal entity which is incorporated or registered in an offshore financial centre or “tax haven”‘.
The extent to which a jurisdiction is regarded as offshore is a question of perception and degree.Classic tax haven countries such as Bermuda, British Virgin Islands and the Cayman Islands are quintessentially offshore jurisdictions, and companies incorporated in those jurisdictions are invariably labelled as offshore companies. Then there are certain small intermediate countries such as Hong Kong and Singapore ,sometimes referred to as “mid-shore” jurisdictions, which, while having oversized financial centres, are not zero tax regimes. Finally, there are industrialised economies which can be used as part of tax mitigation structures, including countries like Ireland, the Netherlands and even the United Kingdom, particularly for corporate inversion.Also, in federal systems, states which operate like a classic offshore centre can result in corporations formed there being labelled as offshore, even if they form part of the largest economy in the world ,for example, Delaware in the United States.
Similarly, the term “company” is used loosely, and at its widest can be taken to refer to any type of artificial entity, including not just corporations and companies, but potentially also LLCs, LPs, LLPs, and sometimes partnerships or even offshore trusts. Read more of this post