TOP 3 tips on the content of foreign companies in 2020 (Part 1)
In recent years, the rules of structuring international business have begun to change at a speed that can be envied by fashion trends and computer technology. The changes are sometimes so serious that they affect all aspects of the creation of international business structures, approaches to corporate governance and tax planning, structuring transactions, asset protection and confidentiality, and in general, everything you could think of.
How many seemingly excellent and thoughtful international business schemes are now being broken into reality when they are implemented, literally when making the first bank transfers ...
How to avoid costly mistakes and keep international business afloat in such volatile conditions? If you are an owner or a manager managing an international business, then it is for you that the Antwort Law team has prepared the TOP 3 recommendations, by adopting and implementing which you will be able to prevent many problems and delays in the operation of your business.
1. The speed of reaction to changes is critically important.
This seemingly truism is well known to any businessman. The sooner you react to the situation, the easier, faster, and most importantly – cheaper! – most issues can be solved. But practice shows that there is often an insurmountable gap between understanding and implementation.There are so many examples of how banal procrastination at times complicated the task and brought losses that a separate bookshelf can be allocated for their description. But we have nevertheless chosen from our practice several, as it seems to us, the most relevant and illustrative situations that demonstrate the importance of a quick reaction of international business.
Example 1. A request has been received from the bank to provide any information or documents.
Perhaps one of the most common phenomena that businesses and foreign companies have to live with today is requests from banks to provide information or documents. They are inevitable and are an integral part of any international business.
In no case should such requests from banks be missed and ignored, and answers to them should always be given on time. It would seem that what could be more obvious and simpler? But in the simplest and most obvious things, most mistakes are allowed.
If the bank does not receive a full response in time, you can completely block the account, and even transfer the information to law enforcement agencies, which will immediately seize it until all the details are clarified. And after the arrest is lifted (usually through considerable effort and expense), the bank will not want to cooperate with you in the future and will close your account, having previously asked you to withdraw money somewhere.
We constantly hear from our customers the question – where to open an account so that the bank does not ask questions? We honestly answer – nowhere. If a bank (or other financial company) does not ask its customers questions, its life cycle will be short, and after closing (about which you are unlikely to be warned in advance) you risk losing all your deposits. So choose reliable banks and be ready to always answer their questions on time and in full.
Example 2. A request is received from the tax service to the address of a foreign company for the provision of any information or documents
Most foreign companies use a virtual or registration address as an address. At the same time, the real business address of a foreign company often does not coincide with the registration address. Because of this, when sending documents received to the registration address, delays very often occur, about a week or even more. Taking this into account, the real time for preparing a response becomes even less than in the case of a response for banks.
The consequences of a foreign company's delay in responding to the tax service may be even more painful than in the first example. The tax service can freeze not one account in a particular bank, but all at once. For example, in the last three years, such a situation has been ubiquitous in Poland, where mass blocking of accounts of Polish companies occurs due to problems with the tax service.
How can such an outcome be prevented? First, choose a reliable provider of registration addresses that will send you the received correspondence without delay. Secondly, do not delay the preparation of answers and always contact professionals who can give you qualified tax advice.
The rule "the faster the reaction, the fewer problems" applies to almost any aspect in the life of a modern foreign (and not only) company. Even if you have enough time to perform any actions, it is better to do everything in advance, because in the process of preparing the same documents, not everything can depend solely on you.
Antwort Law specialists help clients every day in solving a wide variety of legal and tax issues related to international business and foreign companies. We provide only the best service and in the shortest possible time!