If your home country requires reporting of your
worldwide income, then the answer is yes. The tax laws are different in each
country. There is no standard reporting rules that will work in all situations.
Some countries have no reporting requirements on offshore income, some have an
exemption amount, and some want blood.
We recommend that you follow the income reporting requirements that apply to
you. The only time you get into trouble with the tax man is when you don't
follow the rules that apply to you. Most likely you will still come out ahead.
And if you are not ahead at the end of the day, maybe its time to change your
citizenship and/or residency to a lower tax country.
Changing citizenship is not an option for most people for various reasons. So,
it would be easier to discontinue the use of the offshore company and seek other
tax reducing alternatives. People sometimes confuse the tax status of their
offshore company and their individual tax status. It is separate and distinct
from your tax status. Any income you personally receive from the company is
taxable according to your citizenship and residency.
If you have any questions about the above, send us an email.