Companies investing, outside the Netherlands Antilles are not necessary to give at all any taxes on their income that they receive from real estate profits or dividends received.

Each trading composition has advantages and disadvantages. The advantage and disadvantage varies from place to place. Going for the best option always depends on where one would like to start offshore incorporation the business and what one would like to have from the business.

The National Ordinance for the registration of the Aruba Tax Exempt Corporation (AVV) was promulgated on June 30, 1988. There are different kind of companies prevailed in Netherlands Antilles. An AVV is a legal entity with limited liability and an authorized capital divided into shares. The International Business Corporations, the BVI and other offshore centers is based on Dutch civil law, as opposed to English common law statutes.

An offshore company or an international business concern is a legally recognized body registered as per

the rules of a particular country or jurisdiction, having the business exterior to the country of jurisdiction in which the company is registered. An offshore incorporation company can also be registered as an International Business Company (IBC). Offshore companies are not allowed to carry on any business within the Netherlands Antilles unless and until they have received approval from the Central Bank. The Netherlands Antilles profits tax is 32 to 39 percent and applies on incomes drawn from the locally economy.

An off shore company, by and large, has numerous privileges. They are, firstly, in general, is exempted from tax on profit gained out side the jurisdiction. In other words, an off shore company or International Business Centre has zero percent tax rate.

Secondly, an International Business Company (IBC) in the Netherlands Antilles has provided with the provision of maintaining confidentiality of company information. The government of Netherlands Antilles certifies the non-disclosure of corporate or individual records. Information of investors from outside the country are allowed to remain unknown, the applicants may hold bearer shares to maintain confidentiality. This is provision is considered as, by most of the offshore incorporation, very important privilege.

Thirdly, the international business companies (IBC) have minimum regulatory compliance requirements. An IBC has the right to maintain all information in relation to its directors, secretaries or shareholders off the record. The law foils any person from probing in relation to the particulars of owners and employees. The owners are not lawfully required to reveal whichever information concerning their company to anyone.

In addition, the offshore places also put forwards a range of conveniences to different companies like investment companies, financial institutions and alternate businesses that have aspiration to spread out and get the most out of while heaving out minimum or nil tax liabilities. One of the main benefits in Antilles is that there are no deductions on dividends.

On the whole, the Netherlands Antilles provides tax advantages for various international business companies or offshore companies, for some however, different taxation rules apply. Any companies investing, such as real estate companies investing in properties that are immovable, outside the Netherlands Antilles are not necessary to give at all any taxes on their income that may be from real estate profits or dividends received.

In the Netherlands Antilles, for international business companies, taxation is at a competent rate of 4.8 percent to 6 percent of the net profit. International Business Company business overheads, maximum up to 80 percent of the income received, are tax permissible. The net earnings then taxed at the rate of 24-30 percent. However, exceptional rates of taxation address to International Business banks, mutual funds, insurance companies, companies with foreign branches, etc.

Similarly, with investment companies, dividends earned by them are taxed at the rate of 2.4 percent on the first approximately fifty six thousand US dollar (US$56,000) and 3 percent on any returns on top of the threshold. They are free from Capital gains and are as a result not chargeable on investment companies. In addition, company costs, like interest on bank overdrafts or loans and other general payments, are tax deductible.

Unless and until financing companies obtained a favorable tax ruling that permits interest as a business expense and being tax allowable, they are also considered as investment companies. The tax ruling will have to state clearly that where the company does not pay interest.

Investment companies and parent companies of non-Dutch subsidiaries are treated alike. However, it may hold opposing views if the subsidiary is a Dutch company. Being a parent concern of a Dutch business permits the parent to benefit, as part of the agreement between Netherlands and the Netherlands Antilles, important tax benefits.

As per the tax treaty between Netherlands and other European Union members, restrain taxes on dividends are abridged to five percent from twenty five percent and a zero or dwindled rate of tax on interests and royalty from subsidiary companies that profit themselves and their parent companies.

It is very important to note that those companies receiving returns from royalty are taxed on profit at the rate of 2.4 to 3 percent and capital gains are exempt from tax. However, capital losses, by and large, arent tax permissible. If the business produces a least level of taxable income then certain general business expenditures might be avoided from profit before applying the tax. This general business that includes license fees, royalties etc.