How to form an offshore holding company from Monaco

August 6, 2019 - 6 minutes read

Known for being home to the highfliers and their big bank accounts, Monaco is one of the world’s most attractive financial sanctuaries. And it’s not hard to see why. 

The beautiful Principality nestled between France and the Mediterranean Sea offers a crime rate that’s as low as its taxes.

As a politically stable state within the Eurozone, Monaco’s well-developed financial infrastructure makes it one of the best places to manage an offshore holding company from.

What’s an offshore holding company?

It’s a company that’s created in a country with a free trading zone, which holds the assets of one or more subsidiary companies. Most of the time, this is purely for administrative purposes, to benefit from reduced tax and high confidentiality.

How it works

With a controlling stake in an offshore holding company, you’ll have control of its subsidiary companies, and you’ll be responsible for maintaining and managing them.

Being in control of a holding company means you get more say in where to channel your money, whether it’s in trading or investments, property or other ventures.

You can use a holding company for:

  • Investment holding – to hold and trade equities, shares, bonds, commodities, forex, and futures tax free.
  • International trading – either as a new business venture or to expand a parent company into new overseas markets
  • IP holding – hold IP assets for patents and minimise the impact of tax on royalty income receipts and capital taxes

All while making the most of your money in one of the most tax-efficient business structures available.

The 5 biggest benefits

Whether you’re an up-and-coming entrepreneur, an investor looking for higher returns, or you’re looking to make the most of your money for a comfortable retirement, there are lots of reasons opening an offshore holding company makes sense.

1. Reduced tax

Offshore companies are generally seen as “tax neutral”, which means they’ll usually be exempt from tax in the country of incorporation.

When you set up a well-structured company in places like the British Virgin Islands, Seychelles, or Delaware, and manage it from Monaco, the company won’t be liable for Monaco corporate taxes.

With corporation tax charged on profits at 33.33% for Monaco-based businesses that generate over 25% of their turnover from other countries, this could amount to huge savings. That’s on top of any personal tax savings you’ll make for business activity in Monaco.

2. Asset protection

Placing personal assets in an offshore company rather than in your own name protects them from future liabilities. These assets could be property and real estate, intellectual property or equipment, all of which will be harder to track down since they’ll be owned by your offshore corporation.

3. Increased privacy

Most offshore companies don’t have to disclose their directors’ or shareholders’ names for public record. And because business transactions will be made in the company name, not yours, it keeps your dealings private.

This is ideal if you’re looking to keep your family’s financial situation confidential.

4. Protection from losses

Offshore holding companies are protected from losses if the subsidiary company goes into liquidation This means you can’t legally be pursued for compensation if you were unaware at the time of it going under.

5. Simpler probate

When you own property in an offshore company name, this may bypass local inheritance laws on your death, which may otherwise prevent the transfer of assets to your relatives.

The importance of doing it properly

Transparency initiatives around offshore companies are becoming more common around the world, with financial regulators increasingly asking for more information about the assets in low tax jurisdictions.

That’s why it’s crucial that the structuring of yours follows all the right procedures to make sure your new company is compliant from day one.

We’ll handle everything

With over 40 years’ experience helping business-savvy people like you protect their wealth with offshore holding companies, we can advise you on the right legal structure for your circumstances.

We’ll quickly and easily take over all the fiddly administration and the important paperwork and documentation, leaving you to focus on what you do best.

Whether or not you’re already living in Monaco, we’re just a call or an email away from helping you take the next steps towards protecting your wealth.

Get in touch for a free consultation into how an offshore holding company could help you.