What is Re-invoicing?
Re-invoicing is the establishment of a tax haven corporation to act as an intermediary between an exporter and his customers. The profits of this intermediary corporation and the exporter allow the accumulation of some or all profits on transactions to be accrued to the offshore corporation. It should be noticed that a similar structure can be utilized by an importer.
What Would Be an Example of Re-invoicing?
An exporter corporation sells US$ 1.000.000 of exports to Germany normally every year. Assuming cost of goods sold and operating expenses are US$ 600,000. , the exporter corporation earns US$ 400.000 on its sales before taxes. Taxes will average say US$ 160.000 thus reducing net profits to US$ 240.000.
The exporter establishes a tax haven corporation to act as intermediary managed by EUROFINANZZA . The exporter corporation sells its products to the tax haven corporation on paper for say US$ 600.000. The tax haven corporation in turn sells the goods to the French client for US$ 1.000.000. The tax haven corporation, thus earns US$ 400.000. Since there are no taxes, US$ 400.000 is the net income after taxes. The exporting corporation shows no profit. (US$ 600.000 gross sales less US$ 600.000 cost of goods sold).
The US$ 400.000 in tax free income is then deposited into an offshore bank account, according to the wishes of the exporter. The account is under the control of the exporter.
The basic process of re-invoicing, allowed the exporting corporation to save, say US$ 160.000 in taxes less a small re-invoicing charge.
Why Are the Tax Haven Corporation's Profits Free of Taxes?
The intermediary corporation is formed in a country that has no taxes on import-export transaction. For example, the British Virgin Islands, Belize, Turks & Caicos, Seychelles, Hong Kong or Panama have no income taxes on re-invoicing transactions.
How Is the Offshore Company Structured?
To provide anonymity, the nominee officers and directors are provided by EUROFINANZZA who manage the company. Shares are issued and delivered to the owner as proof of ownership.
Will the Offshore Company's Bank Account Have To Be Located in a special Country?
No, the management company can establish the account with any financial institution in any major financial centre in the world. For example, many re-invoicing clients have established bank accounts in British Virgin Islands, Antigua or Turks & Caicos.
How Does the Staff of EUROFINANZZA Know What To Re-invoice?
The beneficial owner of the intermediary company provides instructions on a regular basis by facsimile, e-mail, courier, or airmail.
What About Confidentiality?
It is the policy of EUROFINANZZA as well as the laws of all the tax haven nations concerned that information is not released without the consent for violations of secrecy laws.
What Happens To the Offshore Tax Free Profits that Are Earned?
They can be immediately released as instructed by the owner or alternatively they can be accumulated offshore say with a major international bank where interest on deposit accounts is not subject to tax.
If the Offshore Company is Managed from Tortola, Does it Follow that the Merchandise Has to Be Sent to BVI?
o. The merchandise can be sent directly to the exporter's client. The only functions performed, in Tortola, for instance, are the preparation and dispatch of the new invoice and the management of the banking operations.
What Happens if the Owner Should Meet with a Fatal Accident and the Offshore Company at that Time has in its Name Substantial Assets such as Cash?
Assuming you ensure that your beneficiaries have access to the shares, then if such a case should occur, they would simply produce the shares to the management company together with some sort of evidence of your incapacitation and all control of the assets will be transferred to them. There would be no transfer taxes, estate duties, or other forms of taxation levied on the assets.
What Other Functions will EUROFINANZZA provide?
Once the offshore company has been established, EUROFINANZZA will arrange for a Virtual Office with mailing address in a major international centre, telephone, and facsimile services, available for use by the offshore company. The management company will then begin re-invoicing.
EUROFINANZZA employs multilingual personnel capable of handling any type of transaction. The staff is composed of mostly corporate administrators, bankers and accountants.
What are the Fees for Re-invoicing? How do I Determine whether such Operation is to my Financial Advantage?
The set up costs are generally less than one would think which includes letterhead, telephone, telex, facsimile, mail service, as well as a Belizean or British Virgin Islands tax haven corporation. There will be a small percentage charge on all re-invoicing operations, depending on the amounts of transactions.
Please, let us know full details if you contact us.
Reasonable out of pocket expenses are additional. Annual renewal fees are minimal.
How is an Offshore Company Established ?
Please contact our Sales Department at email@example.com
EUROFINANZZA can also provide you these services through a US LLC company or a UK LLP company, in case you may wish to invoice clients within the European Union.
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