Asset Protection for business owners is defined as a system for taking all assets from every business owned by an individual or a family and changing the ownership to legal entities in another country. These legal entities are often offshore corporations in tax haven countries.
A tax haven country is one which either has a very low tax structure, no taxes at all, or only tax income derived from within its borders. Asset protection for a business owner who prefers avoiding income taxes completely involves choosing one or two tax free countries. For instance, Panama is considered a tax free country because it does not impose an income tax on income earned outside its borders. A Panama call center only handling customers based outside of Panama can make all of its earnings totally income tax free. The same goes for online businesses or companies involved with trades between companies based in other countries. Tax havens provide excellent asset protection for business owners.
Legal entities which can provide asset protection for business owners include corporations, private foundations, and trusts. These legal entities are often referred to as offshore corporations, offshore private foundations, and offshore trusts. The most popular are the offshore corporations as they are perpetual, can do business, and in many tax haven countries can be anonymously owned for better privacy. They can also own many different assets and can open offshore bank accounts and offshore brokerage accounts to conduct different types of investments. Panama has laws protecting the privacy of individual and corporations bank accounts by making it a crime for any bank employee to divulge any information about a bank account to an unauthorized person or agency.
Besides lowering taxes, offshore asset protection for business owners provides a shield against lawsuits filed against the business from jeopardizing the individual’s and family’s assets from being seized to pay off a civil court judgment. This is accomplished because the individual and family members are not the owners of the business which is being sued. The business is also shielded from being dragged into lawsuits filed against the individual and family members because they do not own the business. Lawsuits in the U.S. and other countries are a huge problem as people and businesses can be sued for the silliest reasons. From spilt coffee onto the lap of a McDonald’s drive in customer resulting in nearly a $3 Million judgment to burglars and thieves suing their victims for defending themselves in their homes to drunk drivers suing the owners of cars they crashed into. Asset protection for business owners shields both the businesses and their owners from lawsuits.
Another benefit of asset protection for business owners is that it provides global estate planning so that control of the businesses can be perpetually passed onto the individual’s heirs and then to their heirs. This is accomplished by setting up different offshore corporations to not only own the businesses but all of the assets of the individual and the family. Panama has an advantage over other countries by having a unique law establishing a Private Interest Foundation which can own all the corporate shares of these offshore corporations. This is a perpetual legal entity allowing control over all assets to pass onto the heirs and their heirs.
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