Sole Developer setting up an offshore company for tax reasons

I am self-employed developer resident in an EU country. Currently working on a product that will be eventually be sold online. Over the years I’ve noticed that several smaller UK software companies are registered in Jersey in the Channel Islands.

I’m now looking into doing the same for the purposes of tax reduction NOT tax avoidance. Naturally I would expect to paid tax on my salary to local revenue. Has anyone done this? How did it work out, is it easy, was it worthwhile?

I can't say about the UK but I've setup offshore companies for software development to get around some legal issues. It's worked out great so far. As long as I have the right to found a company wherever I choose, I will go where I get what I want... and so should you. Eventually, I hope, more 'name brand' western governments will see the value of supporting technical entrepreneurs.

The way the tax benefits work in the U.S. and I think in the E.U. are that if you make money in an overseas corporation, so long as the money is not brought into your country of residence you don't have to pay income tax on it. When you bring money into your country, you have to pay the difference in your country's tax rate and that of the foreign country.