How can an athlete evade taxes?

How can an athlete evade taxes? Find out in an offshore adventure!

Welcome to the secret world of offshore. Your goal is to navigate this parallel universe and hide your cash away. Don’t worry! Lawyers, wealth managers and bankers are there to help you.


Juan Penalti
Soccer Player

You’re a soccer star!

It’s 2001. You are a famous international soccer player. Congratulations! Your agent negotiates a $5 million image rights sponsorship contract with a global fashion and sportswear brand. Instead of paying $2 million in taxes on the deal, you want to hide this money from the tax collector.

Open a bank account in Switzerland

Create an offshore company

Smart move – all the better to hide your money… Your bank registers the company SUNNY HEAVEN LTD in the British Virgin Islands (BVI). Your new bank account will be in the name of Sunny Heaven Ltd, instead of your name.

To keep your identity secret, you are advised to name a friend or employ a nominee as the shareholder of the company. Or, you could try to keep the company ownership completely anonymous by using bearer shares.

Pick a

nominee shareholder

Register

bearer shares

With bearer shares, your name won’t appear anywhere. The shares will be owned by whoever physically holds them.

But in 2004, the British Virgin Islands passes the BVI Companies Act, which outlaws anonymous bearer shares.

Your lawyer advises you to change jurisdiction or opt for a nominee shareholder instead.

Pick a nominee

Go to another jurisdiction

The company that supplied you with Sunny Heaven Ltd provides you with a nominee shareholder whose name will appear on the company’s public documents.

But the bank wants to know the identity of the ultimate beneficial owner of the Sunny Heaven Ltd account for their own records. The bank asks for a copy of your passport.

Hand over a copy of your passport

Pick a nominee

You win.

A British citizen in Panama will act as the beneficial owner, also known as natural person nominee, of your company. This will cost more than $15,000 a year, but keeps your tax liability hidden from authorities … for now.

With the money you saved, you buy yourself a sleek Bugatti yacht. It’s time to relax.

Play with another character

Source: https://panamapapers.icij.org/stairway_tax_heaven_game/

How can a politician hide her inheritance away?

How can a politician hide her inheritance away? Find out in an offshore adventure!

Welcome to the secret world of offshore. Your goal is to navigate this parallel universe and hide your cash away. Don’t worry! Lawyers, wealth managers and bankers are there to help you.

Polly Tissien
Politician

Your political star is on the rise!

After years spent climbing the ranks of your party as a member of Parliament, you have finally risen to prominence as a key political player and potential future leader.

Sadly, your father passes away. A controversial political figure in his own right, he leaves behind a small fortune amassed quietly during his years in the pharmaceutical industry after his years as the industry’s advocate in Parliament. His estate includes a secret multimillion-euro Swiss bank account which he bequeaths to you. After careful consideration, you decide not to disclose this secret account lest it raise questions about your connections to your father’s controversial past...

Continue

 It’s 2005. A bill called the European Savings Directive (ESD) comes into effect. Banks are now legally obliged to withhold taxes from the accounts of their European customers.

No need to worry just yet – Switzerland refuses to reveal the identity of its banking clients, so your account will remain secret for now. But as a European citizen, you will have to pay tax on any interest you earn. Your financial adviser suggests two options.

Create an offshore company

Keep the bank account

Because of the new European legislation, any interest you earn from your secret multimillion euro account is now subject to a 35 percent withholding tax.

It gets worse. A few years later Switzerland is pressured by OECD countries to end bank secrecy. Your Swiss banker strongly advises you to transfer ownership of this account to an offshore company if you want your identity to remain a secret.

Create an offshore company

Tax bill dodged! The ESD applies to individuals, not to corporations. You register the company FAMILY SECRETS LTD in Cyprus.

The law firm handling your company’s affairs wants to verify your identity and run a background check process called “Know Your Client" (KYC) or due diligence.

If your identity as a prominent politician from a controversial family is revealed, the law firm might refuse to act as registered agent of Family Secrets Ltd.

They ask for a copy of your passport

Hand over a copy of your passport

WHEW! It’s your lucky day! Your registered agent misspelled your name while doing background research, and nothing shows up about your political career or your father’s checkered past. They keep doing business with you.

A few years pass and you decide to run for president. Congratulations, you win! Muckraking journalists and political opponents will now be looking closely into your finances.

Worried about what they might find, you decide to distance yourself further from your Family Secrets Ltd – but how? You could sell your shares to your husband, or you could pay to have a private foundation become the shareholder of the company.

Sell your shares

Opt for a foundation

You create the BEHIND CLOSED DOORS FOUNDATION, which becomes the shareholder of Family Secrets Ltd.

The public face of your private foundation is a council filled with nominees provided by the law firm handling your company’s affairs, ensuring your name will not appear on any public documentation.

But your political opponents catch wind of a Swiss account left by your father and tip off a reporter about your secret stash of cash.

Come clean

Deny

You win.

Thankfully for you, private foundations offer robust ways to hide your identity. The law prevents your registered agent from revealing the true owner of the Behind Closed Doors Foundation, even to authorities.

Your secret is safe! You use that money to buy a villa in the Antilles, where you sip prosecco and watch the children play from the palm-shaded veranda.

Play with another character

Source: https://panamapapers.icij.org/stairway_tax_heaven_game/

How can a businessman bribe his way into Africa?

How can a businessman bribe his way into Africa? Find out in an offshore adventure!

Welcome to the secret world of offshore. Your goal is to navigate this parallel universe and hide your cash away. Don’t worry! Lawyers, wealth managers and bankers are there to help you.

Edmund von Kronen
Business Executive

You’re a successful business executive.

You made your reputation in real estate but are now eyeing opportunities for new ventures. Your gaze falls on Africa, where there appears to be a fortune literally waiting to be dug up… After all, how hard could running a mining company be?

Unfortunately, your lack of experience in the industry could work against you when it comes to winning an exploration permit.

You’ve heard that bribing a head of state could help influence the permit process. But how will you go about transferring a large amount of money without leaving a trace?

Use cash

 

Use an offshore company

You register the company MINERAL ADVENTURES LLC in Delaware.

The head of state you are negotiating with guarantees you that you will be granted the exploration permit once the “special payment” is processed. To make sure the terms of the agreement are clear, he asks you to sign a document that details the exchange.

You accept

 

You refuse

You negotiate and convince him to forget about the signed document. Your ”special payment” is accepted with a handshake, and your signature is nowhere near the bribe.

You now have to decide how to pay the bribe without getting caught by international authorities. You could make the president a shareholder in your new mining company, Mineral Adventures. Or you could transfer the money through a series of third-party offshore companies – a process called escrow.

Use escrow

 

Give shares

The law firm handling Mineral Adventures’ business agrees to help route the money in such a way that it will be nearly impossible to link the “special payment” back to your company.

You are in the middle of negotiating the technicalities of the cash transfer when an associate of yours is arrested on an unrelated matter. The law firm gets spooked by the unexpected legal attention to your businesses and no longer wants to be associated with you in any way. They send you an email resigning as registered agent for Mineral Adventures.

Call them and negotiate

 

Take your business elsewhere

You decide to create a new company called SECOND CHANCE in Panama and find a new registered agent to help.

Your new law firm – which needs to check your identity to comply with “Know Your Client" (KYC) or due diligence rules, asks to see a copy of your passport.

Hand over a copy of your passport

 

You refuse

You send a copy of your passport, hoping the new registered agent won’t find out about the arrest of your associate.

Unfortunately, the arrest was too juicy for the press to ignore, and a few searches on the Internet easily reveal the links between you and your associate. The law firm refuses to do business with you.

Call them and negotiate

You win.

It worked! With your expert business negotiation skills and the promise of more fees, you convince your registered agent to keep doing business with you. The company helps with the money transfer, and you become the proud owner of the exploration permit n°AFR9082. You can commence operations – and start making more money – in no time!

Play with another character

Source: https://panamapapers.icij.org/stairway_tax_heaven_game/

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