A ‘Tax Haven’ is a country or location with very low ``effective`` rates of taxation for foreign investors. In some traditional definitions, a tax haven also offers financial secrecy. They also share limited or no financial information with foreign tax authorities. A primary advantage is that they do not typically require residency or business presence for individuals and businesses to benefit from their tax policies. Investors and businesses may be able to lower their taxes by taking advantage of tax-advantaged opportunities offered by tax havens, however, entities must ensure they are compliant with all relevant tax laws.
We’ve established a ‘Corporate Tax Haven Index’ which considers ranking of one of the world’s most important investments for multinational corporations, investors, and small businesses; according to how aggressively, and how extensively, each jurisdiction legally and flexibly empowers global businesses in contributing to their taxable incomes and tax savings in comparison to their home country. Tax havens are dominantly sought within ‘secrecy jurisdictions’ or ‘regulatory havens’, based on the need of the enterprise. Every multinational or investor, have multiple subsidiary incomes and a chain of affiliations festooned across tax havens and other countries around the world. Therefore, through systematic financial management, large profits can be moved into low-tax or zero-tax havens where a little tax is incurred, and the costs can be moved into high-tax countries to deduct against tax bills.
Worldwide there isn’t a comprehensively defined standard for the classification of a tax haven country. However, there are several regulatory bodies that monitor tax haven countries, including the Organization of Economic Cooperation and Development (OECD) and the U.S. Government Accountability Office. Some companies that have historically been known for offshore, tax haven holdings include Apple, Microsoft, Alphabet, Cisco, and Oracle. Overall, tax havens may also offer advantages in the area of credit.
A list of some of the most popular tax haven countries includes Andorra, the Bahamas, Belize, Bermuda, the British Virgin Islands, the Cayman Islands, the Channel Islands, the Cook Islands, The Island of Jersey, Hong Kong, The Isle of Man, Mauritius, Lichtenstein, Monaco, Panama, St. Kitts, and Nevis. However, each country levies a different application and incubation structure for foreigners. Interested in increasing your profits? Learn more.