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Home > Offshore Services > Offshore Company Formation > Company Formation Benefits > International Trading
Using Offshore companies for international tradingOne of the most popular uses of offshore companies is in international trading. Concentrating the buying activity in a single company, for example, assists in the negotiation of the keenest prices and the back office services can be located in a single, offshore centre. Similarly the banking activity can be conducted through offshore banking accounts free of restrictions such as currency controls. If the trade involves purchasing products in one country for re-sale in another, the profits may be retained in the offshore centre free of taxation there. Where intra EU trade is involved, ie the purchase of products in one EU country for re-sale in another, there are specific advantages in basing the operation in the Isle of Man. When all the parties are registered for V.A.T. purposes no V.A.T. need actually be paid until the product is finally sold to the ultimate customer. This method of trading is known as triangulation. Sometimes, owing to restrictive tax laws in his country of residence, one of the parties to a transaction may be unable to benefit from arrangements such as are described here. In these circumstances we recommend considering the alternative of a partnership.
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