Why incorporate in non AEOI countries

Forming a company in a non-AEOI (Automatic Exchange of Information) jurisdiction offers several potential advantages, particularly for businesses or individuals seeking to optimize their financial privacy, reduce reporting requirements, and benefit from tax incentives. Here are some key benefits:

• Limited Information Exchange: In non-AEOI jurisdictions, there is no automatic exchange of financial information between countries, meaning that your financial and business data may not be automatically reported to foreign tax authorities. This provides an added layer of privacy.
• Reduced Risk of Disclosure: Businesses and individuals may avoid public disclosure requirements (such as the reporting of beneficial ownership) that are common in AEOI jurisdictions.

• Lower Corporate Taxes: Many non-AEOI jurisdictions offer preferential tax rates, tax incentives, or even tax exemptions for certain types of business activities. These jurisdictions may have lower income tax rates, no capital gains tax, or other tax benefits.
• No Withholding Taxes: Some non-AEOI jurisdictions may not impose withholding taxes on dividends, interest, or royalties, which can be advantageous for international businesses.

• Less Bureaucracy: Non-AEOI jurisdictions often have streamlined company formation processes with fewer regulatory hurdles and less stringent ongoing compliance requirements.
• Easy to Set Up and Maintain: Many of these jurisdictions offer quick, cost-effective company registration with minimal ongoing paperwork or auditing requirements.

• Reduced Regulatory Oversight: Companies in non-AEOI jurisdictions may face less international regulatory scrutiny and may not be subject to the same level of enforcement as companies in AEOI countries.
• Minimized Impact of International Financial Regulations: These jurisdictions may not participate in international tax initiatives like the OECD’s Common Reporting Standard (CRS), meaning the company is less likely to be targeted by international tax authorities for audits or penalties.

• Access to Global Markets: Companies in non-AEOI jurisdictions can still operate internationally while benefiting from a stable, low-tax, or non-tax jurisdiction. This is useful for businesses with international clients or investors.
• Offshore Holding Companies: Non-AEOI jurisdictions can serve as holding company hubs, enabling businesses to structure their operations efficiently without triggering complex international reporting or taxation.

• Shielding Assets: Non-AEOI jurisdictions may provide a safer environment for protecting assets from creditors, political instability, or legal disputes, as these countries may have stronger privacy laws and are less likely to cooperate with foreign legal authorities.
• No Inheritance or Estate Taxes: Many non-AEOI jurisdictions do not impose inheritance or estate taxes, offering benefits for wealth preservation across generations.

• No FATCA/CRS Compliance: In AEOI jurisdictions, entities must comply with regulations like the Foreign Account Tax Compliance Act (FATCA) and the OECD’s Common Reporting Standard (CRS). Non-AEOI jurisdictions are not required to comply with these reporting standards, so companies are not required to disclose sensitive financial information to foreign governments.

• Favorable Double Taxation Treaties: Although non-AEOI jurisdictions may not engage in information exchange with certain countries, they may still have favorable tax treaties in place with select nations that help avoid double taxation, providing a tax-efficient structure for international businesses.

• Political and Economic Stability: Many non-AEOI jurisdictions are politically and economically stable, which can provide a secure base for long-term business operations.
• Currency Flexibility: These jurisdictions may offer more freedom in currency usage, potentially allowing companies to operate in multiple currencies without facing restrictions from local central banks.

• Attractive to Investors: A company incorporated in a non-AEOI jurisdiction may attract investors who value privacy and tax efficiency. This can make it an appealing location for venture capital, private equity, and international investors looking for a favorable environment.

List of countries which are not participating in Automatic Exchange of Information:

Algeria, Angola, Belarus, Benin, Bosnia and Herzegovina, Botswana, Burkina Faso, Cabo Verde, Cambodia, Chad, Congo (Republic of the), Côte d’Ivoire, Democratic Republic of the Congo, Djibouti, Dominican Republic, Egypt, El Salvador, Eswatini, Fiji, Gabon, Guatemala, Guinea, Guyana, Haiti, Honduras, Lesotho, Liberia, Madagascar, Mali, Mauritania, Namibia, Niger, North Macedonia, Palau, Paraguay, Philippines, Serbia, Sierra Leone, Tanzania, Togo, Uzbekistan, Vietnam, Zambia, Zimbabwe.