The main task of financial institutions is a transfer of financial flows in the form of loans and paid interest on contractual agreements.
The registration of offshore companies are jurisdictions that offer the most favorable tax regimes banking.
In offshore credit schemes involved a company providing loans, intermediary firms and corporate borrowers.
On the example with two subsidiaries can visually explore the concept of the credit scheme and see its benefits. Suppose that the registration of one of the subsidiary companies is an offshore zone and the second registered in the country, subject to the law of double taxation. Function of an offshore company is the accumulation of income not subject to taxes or charges, and the second company acts as an intermediary and distributes financial flows are the most economical in terms of taxation channels.
Credit schemes begin with the parent company of investment funds in the asset offshore company.
In the future, these are the same tools as a credit for another subsidiary company with tax incentives to trade in bank interest. The last in the chain becomes a party to the company credited the second subsidiary. Accrued interest on credit agreements ends up on account of the offshore company, where securely sheltered from taxation, and all the rest of the credit scheme are able to increase their costs to the amount paid for the use of credit interest.
In more general credit schemes are to provide offshore company loans to resident companies. These funds can be, for example, as a prepayment on foreign contracts. The current legislation provides a specific period of repayment of the loan, so after a while money is returned to the alleged failure to comply with the contract. But during that period, while the funds were in the account at an offshore company, the latter could actively use them in economic activities and not pay taxes on this income when received.
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