One way you can avoid some South Africa tax is to deposit or invest some of your money in a place where no taxes are imposed on it - in a place where the South African Treasury can't impose one cent's worth of tax on it.
But you must remember to declare information when required to do so by the law. Offshore financial investments are not the 'secret' havens they used to be. South Africa already has tax treaties with large number countries - offshore centres included. Be aware these treaties allow for the free sharing of information between the South African authorities and the offshore haven concerned.
The easiest way to invest offshore is to make deposits in offshore bank accounts. But first however you must decide which offshore jurisdiction to invest in. You should bear in mind that not all banking havens will be suitable for you, safe or secure. Many are exceptional, others not so good. If you put your money in the wrong country, it could later on prove to be costly.
How to select the top jurisdiction:
#1 - Location, location, location
You should ask yourself these questions: is getting the haven a problem? Will you need to queue at the embassy for a visa every time you want to visit? Remember to give some consideration to time differences. Can you manage your financial affairs efficiently if it's midnight in your haven during business hours at home?
#2 - Do you speak the lingo?
Effective financial management depends on smooth-running, fluent communication. Do the bankers and brokers speak your home language? If you instructions are misunderstood it could cost you dearly and be badly executed as a result of language barriers.
#3 - How about the legal system?
You should satisfy yourself that the offshore centre has good local laws and legal practices that provide adequate protection of your funds and investor rights. Are the laws of the offshore centre based on English common law, which is used as a source in Sa mercantile law? Is the court system effective? Are banking services and investment brokers registered with regulatory organisations that uphold professional standards and procedures?
#4 - Is your haven financially stable?
A haven's confidence in its liquidity can be judged - at least to some degree - by it's willingness to put in place solid depositor protection. Find out from financial institutions in the haven whether or not depositor protection exists - in the event of a bank failure, the secret is to ask, ask, ask.
Arnold Jvr is an article writer. Potchefstrooom is a city in South Africa. Not only does this author specialize on certain topics, you can also check out the latest business website Potchefstroom and Potchefstroom Accommodation |
Like every offshore business it have pros and cons. It need a good research, but even after that there are things that are invisible until you actually start doing business abroad.
ReplyDeleteProbably it is a good idea, but for sure there are more risk involved and much more uncertainty.
ReplyDelete