Holding properties in the world using an offshore holding vehicle
Setting up an offshore company to hold properties has become a trend in recent years, especially in metropolitan cities, such as London, Hong Kong, Singapore, Beijing ,Shanghai and New York, where property prices are still edging up despite the recent economic downturn as a result of COVID-19.
The primary reason to use an offshore company to hold property is down to confidentiality. In general, ownership details are recorded publicly at Land Registry in the UK, the same also applies to Hong Kong and Singapore, amongst other countries. A vast majority of wealthy Clients do not want their details to be made publicly available. There is a security concern behind this and most Clients are using the offshore vehicle to get this sorted; first, the Client needs to form an offshore company first and then register the company to be the owner of the property. By having done this any searches performed by anyone would only show the name of the company as the legal owner.
The second reason to utilise an offshore vehicle is to make your tax liability more efficient. The offshore company might be allowed to reduce the level of capital gain tax or no tax at all depending on the jurisdiction in which your property is located and the location of your offshore company is incorporated. In some jurisdictions, capital gain tax is not applicable to offshore companies holding a real-estate portfolio.
The last reason is to use an offshore bank account to receive rental income should you wish to let out your property to a tenant. This business bank account can also be used for proceeds that come from the sale of the property.
Sinda Corporation incorporates companies for our Clients in more than 20 jurisdictions with a tech-savvy, online friendly order system that forms companies and opens bank accounts with a click. Our turnaround time for forming a company comes as quickly as 24 hours. Our support team is 24/7 for you to answer any queries you might have. To kickstart the process, please click here to place an order.
Disclaimer: The information provided in this article does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. You should seek professional advice prior to engaging with us for an order.