Question Risks of using a Shelf company

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Adam1000

New member
I'm speaking to a firm in Cyprus to help me get set up there. They said they have a set of new shelf companies ready for use.
I'm wondering what risks are involved in buying a shelf company? Could it have debts that I would be liable for? Is there any way to check this?
 

James Turner

Mentor Group Gold
Business Angel
When taking a shelf company over, you would become liable for any debts that the company has. It is almost impossible to check the debt situation of companies and so you will need a reliable supplier to ensure that you do not take on hidden debt. I should say however that in most cases shelf companies are created especially to be sold and so have never traded or been in the hands of a client and so it is highly unlikely that debt exists. The supplier should give you a certificate of none trading if this is the case, but be aware that this documents is produced in house by the seller, so it is not really worth anything if they untrustworthy.
 

CyprusLawyer101

Mentor Group Gold
Nornally if you are working with a decent firm in Cyprus, expect no issues or surprises with shelf companies.
Note though, that if you do not have a particular reason for buying a shelf company, it might be best to incorporate a new company which shouldn't take more than maximum 10 working days to achieve.
 

clemens

Corporate Services
Mentor Group Gold
How is it going with your setup, do you want to let us know who you are dealing with?
 

Adam1000

New member
Sorry for the silence, busy couple of weeks.
The Cypriot agent I'm dealing with doesn't have a lot of info online on them that I can find. But I got in touch with them through a very reputable tax advisor here in Sweden that they cooperate with. I'm partial to working with them because I need to keep my other company in Sweden active and they specialize in Cyprus/Scandinavia.

So far, I'm still researching to make sure I will not end up with a wrong setup that will force me to keep paying taxes in Sweden.
 

Sols

Staff member
Mentor Group Gold
So far, I'm still researching to make sure I will not end up with a wrong setup that will force me to keep paying taxes in Sweden.
Are you going to move to Cyprus or somewhere else besides Sweden? If you are being told that you can just set up a company in Cyprus to avoid Swedish taxes, you are not getting good advice.
 

koohl

Mentor Group Gold
If you are being told that you can just set up a company in Cyprus to avoid Swedish taxes, you are not getting good advice.
very true, this is never going to be accepted. They are harsh with people and businesses that try to escape taxes in Sweden with offshore company setups.

If you want it to work without relocating, the mentor group gold is your first stop to discuss your options. I had my experience there already!

If you are willing to relocate, it may work well, just research your options and compare the towards your requirements to living, life style etc.
 

Adam1000

New member
My plan is to relocate. Not just for taxes but I like the country (great weather, chill atmosphere and close to my favorite destinations). I just need to keep my Swedish business active because some clients will only work with domestic companies.

I haven't looked at the mentor group, I'll check it out.
 
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