Free Zone Company vs Offshore Company

[AndrewT]

As you know these two types of companies are a little bit different although they bought aim foreign investors. I want to know what are the benefits of one of this types of companies compared to the other.

 

[JohnLocke]

Primary reason, for instant Uruguay (so many other countries have) have free zones like Zone‌ America and others, the differences are that they don't pay tax or only little tax‍ percentage even if you are doing business within the country. For instant a Seychelles company⁠ can't do business within the Seychelles without to pay tax which most often isn't any⁤ problem.

 

[AndrewT]

I see. So basically free zones are introduced in order to attract foreign investors because‌ of low (or no) taxation. This period is probably time limited though.

 

[JohnLocke]

That's correct, in the jurisdictions where I have been there is no time limit.

 

[taruniis]

At first, you will have a hard time understanding all these. They are not the‌ typical economics lessons that you will get from middle school. Offshore companies are somehow “investors”‍ for a country. They are sources of money even if they are not recorded like⁠ the onshore ones.

 

[JohnLocke]

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[taruniis]

This forum is already a good source of information. I can see that the admins‌ here are very eager to answer questions, too. The discussions are healthy even if there‍ are clashes of opinions. There are some information that you cannot easily find on the⁠ Internet.