One of the most effective methods of tax planning is going offshore. The notion comes from the English "offshore" – which means "overseas". In the basics of the offshore business is a deep knowledge of the laws of the fiscal paradise, as well as onshore jurisdictions with attractive business opportunities. In such jurisdictions, foreign firms have huge tax incentives (tax exempt partially or even completely) – this is what interest makes the opening of an offshore company. An offshore company is not a direct activity in the jurisdiction in which it was registered, and its immediate owners as are residents of other countries – and is one of the requirements of the legislation of countries with similar tax benefits. There are also other restrictions – an offshore company almost always has to earn profits in the country of registration. Benefits of establishing an offshore company line – forming an offshore company, the employer may legitimately reduce the amount of their tax payments.