Why a Delaware Company?
Zero percent tax on corporate and personal income
Extremely private; no free public access to beneficial ownership information
Shareholders, directors and officers can reside anywhere in the world
Trusted Legal system and stable political system
A minimum requirement of one director and one shareholder
No requirement to file annual reports or financial returns
Local legislation geared towards favouring business and entrepreneurship
Jurisdiction not tainted with negative offshore associations
Delaware Company Key Facts
Delaware Company Tax Information
A Delaware offshore company enjoys the highest degree of tax efficiency, with companies having no liability to pay either corporation tax, income tax, stamp duty tax, asset tax and or exchange controls on any corporate or personal income derived outside of the jurisdiction.
Delaware is a popular offshore jurisdiction to incorporate an offshore company as a result of its highly tax efficient system and trusted political environment as a national state of the United States of America. The Unites States in total accounts for one fifth of the global market for offshore financial services. By 2013, over 65% Fortune 500 companies have been incorporated within Delaware alone, benefiting from its favourable tax system. Furthermore, Delaware’s taxation policies enables international companies to operate with maximum financial flexibility.
Companies are tax exempt pending on the company and its members meeting the following prerequisites:
- The member(s) of the offshore company must all be non-resident in the United States
- The offshore company must not employ any United States residents
- The offshore company must not conducting any trade or business activity within the jurisdiction itself.
The annual tax levy on Delaware LLC companies stands at the flat rate of $250 as a ‘franchise tax’, independent of profits earned, income, assets accumulated, and generally the income serving from business activity outside of the jurisdiction.
Not applicable to an LLC. An LLC does not issue shares and therefore does not named shareholders. The owners of an LLC are referred to as members. There is a minimum of one member.
Type of Shares
Bearer shares not permitted.
Corporate or individual
Must the Director/ Manager be resident?
Minimum paid up capital
Not applicable to an LLC. You can form a Delaware LLC with any capital amount decided on.
Restrictions on trade
Companies are not permitted to trade within the jurisdiction, own real estate; or undertake the business of: banking, insurance, collective investment schemes, trust management, trusteeship or offering investment advice.
Type of Company
Location of meetings
Not required, you only need a Delaware registered Agent
US Dollar (USD).
Name of the company
A Limited liability Company’s name must end with LLC or LC. Restricted names include anything identical or too similar to an existing company within the state.
Delaware has superior levels of privacy and data protection measures designed to protect confidential business activity and ownership of an offshore company. The director(s) and member(s) of a Delaware LLC have personal details and information pertaining to the companies’ operation highly protected with no requirement for such information to be stated on the Certificate of Formation. Financial accounts and audits of the company are also not publicly accessible or within the public domain.
Delaware offshore companies are subject to FACTA legislation introduced in 2010, in an effort by the jurisdiction to improve global tax transparency. The United States have set an international example for tightening regulation on tax evasion and illegal financial activity. The Act is based upon several bilateral data-sharing deals with other 94, and growing, jurisdictions.
The United States’s introduction of FACTA in 2010 has incentivised the OECD, to assume intergovernmental responsibility over global tax transparency through initiating the Common Reporting Standard (CRS) for thorough data disclosure pertaining to offshore company operation. The United States including Delaware state has however seen no necessity to join the CRS on the basis that it already has sufficient legislature in place namely FACTA to prevent tax abuse. FACTA however has been observed as less thorough in its data retention aa it passes on names and interest earned of offshore accounts, but not account balances, furthermore it does not scrutinise the corporate structures which may own several accounts to reveal the beneficial owner.
Nominee director(s) and shareholder(s) are additionally available to protect the anonymity of a Delaware offshore company.
Delaware Background Information
Delaware has a stable and strong economy, consistently ranking as the ninth richest state in the United States. Moreover, Delaware is the largest state in America in terms of company formations. The economies’ success is attributed to it’s business friendly legislation that has attracted many large corporations and near 60% of NYSE listed companies to incorporate their business in the jurisdiction. The favourable tax incentives have been able to boost investment even further.
Delaware’s strong economy is attributed in part to its successful aviation industry which in recent years has experienced the fastest paced growth creating 2,600 jobs and generating $588 million in annual economic output.
The finance, insurance and real estate industries too collectively contribute significant amounts to the jurisdiction’s gross state product. With growth in the finance and insurance sectors typically translating to growth in the real estate sector. The captive insurance industry in Delaware in particular contributes nearly $360 million to Delaware’s gross domestic product (GDP), creating 2,537 jobs, and generating a predicted $109 million in personal income and $5.6 million in government revenue.
Delaware as a national state of the United States enjoys superior political stability. Delaware was the first state to ratify the Constitution of the United States, and hence is named ‘The First State’. Investors are drawn to the jurisdiction as a result of it’s trusted political stability and autonomy enabling business friendly legislation and tax efficient incentives.Delaware has one of the smaller legislative houses in the United States with 21 Senators and 41 Representatives promoting the state’s political interests.
In addition, Delaware offers a sturdy legal system with the Court of Chancery ruling on business related conduct with final decisions concluded by the judge rather than jury.
The principle legislation governing company operation is the Delaware General Corporation Law which forms the basis of the Court of Chancery rulings. The law is widely regarded as providing great flexibility to offshore companies.
Delaware Banking Services
- High-level confidentiality – Banking privacy is reinstated by statutes. Authorities have access to bank information in criminal tax matters where a court order is present only.
- Variety of payment options – With accounts in several currencies, internet banking, international wire transfers, debit and credit cards, prepaid cards, checkbooks, merchant accounts, brokerage accounts Delaware bank account holders enjoy great payment flexibility.
- Low initial deposit requirements
- Full operative control– Secure Internet-banking facilities, with no need to install specific software on computers or other devices.
- Wide choice of payment cards
- No personal visits to Delaware is required to open a bank account.
- Free account application – The bank charges no fee for account opening.
Bank Account Requirements:
✓ Certified copy of passport
✓ Bank reference from a bank, which knows the person over 2 years
✓ Professional reference from an individual who knows the person over 2 years. If you do not have a relationships with a professional, the bank needs a second bank reference from another bank.
✓ Proof of address (original utility bill with individual’s name and residential address).