Registering a business offshore is not a usual practice for Nigerian entrepreneurs. This shouldn’t be the case, as the registration location of a business affects its operations. This process is known as regulatory arbitrage, which defined loosely is the process of taking advantage of softer regulations in other countries and jurisdictions. Here are 2 ways it can help entrepreneurs launch global startups from Nigeria.
Minimize taxes. Registering an offshore company can legally minimize the tax obligations of a business. For many startups, this is a primary reason. In some cases, non-resident companies enjoy encouraging tax rates. However, this can be very complicated and there is a need to consult tax, legal and finance experts to understand the full weight of all options available.
Provide for investment diversification. If you are thinking of launching a global startup, investment diversification may help diversify your market risks. Setting up an offshore entity can help you diversify your investment portfolio. Again, this needs proper planning and execution and experts are important in guiding entrepreneurs.
This article is part of a series of conversations around helping entrepreneurs in Nigeria start businesses with that cater to a more global audience. This will help improve Nigeria’s export base and create sustainable trade surplus for the country. These issues will also be discussed more extensively at the SMW 2017 event, themed, Leveraging Digital to Build Global Startups from Nigeria. To learn more about Leveraging Digital to Build the Global Startup from Nigeria or SMW Lagos 2017 and register to attend visit click here. For the latest news and updates follow Startit.ng on Twitter via @StartitNG or on Facebook via www.facebook.com/StartitNigeria