Due to the large amount of jurisdictions available, and difficulty of obtaining first hand knowledge about the actual functioning of jurisdictions and structures as explained in promotional materials, one should be extremely cautious when selecting the most suitable package for either international trading or protection of personal assets.

Professional guidance is not cheap but essential (given the risks), to ensure the solution is in fact a fully comprehensive one. Most offshore jurisdictions are free from foreign exchange controls and their company laws enable a variety of international business, however it is vital to research whether such country has a positive international perception or not. Straight away one must weigh the importance of such factors as the impact on business partners or one's bank of using a company registered in a so called 'tax haven', in contrast to less conspicuous international structures secured in a treaty jurisdiction, or an onshore company that combines also offshore benefits.

Double Taxation Avoidance Treaties

All countries or 'jurisdictions' fall into one of two classifications: Treaty jurisdictions (countries which have agreements with other states so that tax is only paid in one of the countries) and Non-Treaty jurisdictions (countries without such a network), either of which shall be more appropriate, according to the taxation implications of the business that is to be conducted.

A treaty jurisdiction is where clients opting for the benefits of double taxation treaty relief should divert their attention to, incorporating therein so as to minimizing any withholding taxes on the payment of dividends and royalties from contracting states.

On the other hand one should opt for a Non-treaty jurisdiction where lack of corporate taxes on company profits is paramount. Such benefit comes at the minimal cost of a fixed annual license and maintenance fee. Typically a treaty jurisdiction would not be required for international movement of goods and most services, although inbound investment into certain countries, may necessitate the use of a treaty jurisdiction to mitigate taxation.