What`s the difference between a domestic company and an offshore company?

In theory, an offshore company is a company (corporation) registered outside the domicile country of the beneficial owner. However, the term “offshore” is most commonly used not simply to refer to any other country outside the domicile country, but directed particularly to the “tax havens” – low tax or zero-tax countries. So, in practice, the offshore company enjoys many benefits that are not exactly possible for a domestic company back at home.

An onshore corporation must pay income tax (sometimes very high amounts), whereas an offshore company is tax-free or has a considerably lower tax rate. An offshore company is also free from financial reporting and sophisticated accounting requirements. To form an offshore company, the company owner does not have to commit high sum of paid-up capital, or any capital at all. Offshore corporation is not required to register its shareholders and directors on a public file. Offshore company is easy and quick to register, simple to operate and maintain. Apart from those benefits, the internal structure and management principles of offshore companies are still largely similar to those of any "regular" business corporation.