Offshore companies limited by guarantee

It's been mentioned that rather than using a standard offshore IBC an alternative could be to use an offshore company that is 'limited by guarantee' to avoid UK taxes. Companies that are limited by guarantee are usually used charitable activities, and not commercial trading ventures, at least that is how the UK entities are used. However, there's nothing to prevent you using a company limited by guarantee if you wished. Difference from a 'normal' limited company You can form a company limited by guarantee in the UK as well as in various offshore jurisdictions (eg Gibraltar). It differs from a standard company in that when you form a company you would usually subscribe for share capital and would then effectively own that company in accordance with the share capital owned. You could then extract cash from the company as a dividend (which is a payment in reference to the share capital) and could also sell the shares in the future. This would crystallise a capital gain on you. You could also wind up the company and extract cash as a capital distribution which would also crystallise a capital gain on you. If you use a company limited by guarantee there is no share capital. The company still has limited liability (in most cases) but instead of it being limited to the share capital it's limited to an amount that you guarantee to pay. Therefore you're not a shareholder in the company and are referred to as a 'member'. Strictly speaking you don't actually own the company which is why it is a favoured entity for charities. You can see more on the tax implications of offshore companies limited by guarantee at: Offshore companies limited by guarantee and UK tax