The Best International Tax Planning solutions since 1991	A A
HOME > Services > Company formation > Ready-made companies > Vintage companies >

Description

Vintage companies

Companies which have been incorporated for several years (2, 3, 4, or more), but have carried out no business activities since the time of incorporation, are known as vintage companies. These companies are stored, like fine wines, so that once they have reached a certain maturity they will be able to begin operating.

When is it worth buying a vintage company?

There are a number of reasons for buying vintage companies. These include, for example, reasons of prestige, where the people operating the company buy a company which was incorporated earlier so as not to begin their business activities with a freshly incorporated company. It may also be the case that the purchase of a company incorporated earlier is required for administrative reasons. Certain tenders and applications are only open to companies of a certain age (e.g. minimum three years old). In addition to these reasons, vintage companies have an indisputable advantage over freshly incorporated companies in that they could have operated, signed contracts, acquired rights and assumed responsibilities from the date of incorporation.

Why are vintage companies more expensive?

The price of a vintage company is made up of several components, and is generally higher than the price of a freshly incorporated company. Firstly, there is the fee for the original incorporation of the company; in addition, the annual maintenance fees (registered office and agent and annual tax) for each year of the company's existence must be paid - the person or company originally incorporating the company has already had to pay these each year, so obviously he must recover his expenses before he will sell on the company. Finally, there is usually a maturity fee, which is generally a fixed annual amount for each year of the company's existence.

Bank account opening

Company formation

Secretarial services

Asset protection

European offices

Offshore company

An offshore company is an enterprise which only carries out economic activities outside the country in which it is registered. So, an offshore company can be any enterprise which doesn't operate "at home". At the same time, according to public opinion, an offshore company is any enterprise which enjoys tax-free or low-tax status in the country of registration. In the USA, the term offshore company is also used as a synonym for any overseas activities. The offshore company existed in ancient Greek times, when Greek merchants offered their wares from nearby islands in order to escape the taxes in Athens. The format of the modern offshore company, however, is undeniably linked to the United Kingdom, and it was the British who developed the offshore company as we know it today. It was English corporate law, adopted in one form or another by just about every British territory, which provided the basis for the establishment of the laws necessary for the incorporation of offshore companies. If we examine the most significant tax havens where it is possible to incorporate offshore companies, then the British legislative roots can be discovered almost everywhere. And here it is not just the everyday transplantation of offshore companies as is the practice in common law which we are talking about, but the legislation itself, based on the English law, specifically allows for the establishment of the offshore company, often through a separate law. For example, numerous jurisdictions have copied one of the most popular laws regarding offshore companies of the last 25 years, the British Virgin Islands IBC Act, which replaced the BC Act, though the rules for the formation of an offshore company hardly changed under the new law. The only real change in the British Virgin Islands is that while it was possible earlier to form an offshore company with bearer shares, this possibility has now been very tightly restricted. It is still possible today for an offshore company in the BVI to issue bearer shares, but such an offshore company will pay a minimum of 1100 USD in annual tax as opposed to 350 USD, and an offshore company formed this way has to deposit the issued shares with a person specifically authorised for the purpose.

Back to top

This general information material is protected under copyright. The written consent and permission of the authors is required for the copying or reproduction of the whole or any part of this general information material by any means, as well as for the utilisation of the contents of this general information material in other publications. The authors assume no responsibility for any typing, setting or printing errors that may occur in the material.
The information provided should not be construed as concrete taxation advice. The authors assume no responsibility for any possible losses which may arise as a result of misuse of the information.
© Laveco Marketing Ltd, Belize - 2000-2009

WWW.LAVECO.COM