How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask bigduckontax Your Own Question
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 4959
Type Your Tax Question Here...
bigduckontax is online now

What are the benefits of having a limited company from the

This answer was rated:

what are the benefits of having a limited company from the British virgin islands? I read that the tax is very, very low.... how does it work? Thanks.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. You may have noticed from media comment that using a company in a tax haven like the BVI, Gibraltar or the Channel Islands is a common method of tax avoidance. The big boys like Amazon, Srarbucks, Vodafone all use this and I cannot help but think that it will not be long before legislation is introduced to curtail this practice from a taxation perspective. You will have noticed the recent row over Google's settlement of several years tax due for a relatively low amount. The system works by the BVI company invoicing say an UK company for a sum of money to suck the profit out of the UK taxman's clutches into the tax haven's. However, running companies in tax havens is big business for those areas and the practice does not come cheap, so unless the UK tax savings are substantial then this game is almost certainly worth the candle and may well, in the long term, be subject to legislative change. I do hope that I have been able to shed some light on this subject..
Customer: replied 2 years ago.
Thanks for replying but my original question was how do they work? I know about paying very little tax or even tax avoidance, but I need to know how they work. Thanks.
They work like any other company. However, they usually have to have local directors, registered offices etc which is where the additional costs are incurred. Disclosure requirements, particularly in the BVI, are often minimal, however. That is one of the big advantages of trading offshore.
bigduckontax and other Tax Specialists are ready to help you
Thank you for your support.