Over the last few decades, there has been a meteoric rise in e-commerce and online business models due to the advancement of technology. The new way of doing business can be done with online transactions.
Many companies host their trade solely on a virtual platform that can be exposed to different risks and regulations. In addition, if a company is doing business with clients across the world, then the option exists to legally position the business in a jurisdiction that is favourable for the majority of businesses.
An existing e-commerce business that is located in the UK serves their-nation UK customers from a foreign subsidiary in a low or no-tax jurisdiction. To get full advantage from the offshore e-commerce opportunity for tax optimisation purposes, you have to set up an offshore company that you do not own or control. This will be your platform for an overseas company with great tax benefits.
The advantages of setting up an offshore merchant account for your business are as follows:
- Lower tax burden.
- Profits can be grown offshore - tax-free.
- You can select your accounts in different currencies.
- For making payments all kinds of credit cards can be used.
- All the transactions which are processed should be kept confidential.
- Permissions are granted for high transaction volumes.
- Payment gateways can be easily implemented with an existing e-commerce website.
- Without downtime, the account can be managed.
- The main business of geographical location is unrelated.
- High risk of business is also allowed.
- No upfront deposits are needed apart from high-risk businesses.
For setting up an offshore merchant credit card processing service there are two ways:
- Opening a merchant account with the help of an offshore payment-processing clearinghouse.
- By setting up a direct merchant account of yours.
For start-up businesses, the most appropriate way is, to begin with, a clearinghouse processor. In this route, you need to hire a third-party service that will allow providing a bill to the customers using their merchant status, it will allow a unique descriptor to appear on the statements of your customers so that they will be able to recognise your transactions. This route allows you to develop sales momentum before you take any impulsive step in your business.
Moreover, this process will be much faster, and the processor will then sponsor you for your direct merchant ID with a bank they have been working with. After 6 months or one year, when there is sufficient sales transaction a business can switch to a direct bank processing relationship with an offshore bank.
The majority of the online merchants will want to consider choosing offshore payment processing clearinghouses to reap the benefits that are available with such an initiative. Therefore, If you want to open an offshore merchant account for your online business but are confused about the process, then you can contact RTRSupports Limited to get the best assistance.