Companies use tax avoidance arrangements and complex financial structures around the world to reduce tax costs mainly through the following methods: 1. **International restructuring**: Companies may set up subsidiaries or branches in low-tax countries or regions, such as Ireland, Luxembourg or Singapore. These countries attract multinational companies to set up headquarters or regional offices with their favorable tax policies. 2. **Profit shifting**: Through internal pricing (Transfer Pricing) strategies, companies can transfer profits from high-tax countries to low-tax countries. Although countries have strict supervision on this, companies can still use complex transaction designs to show less profit in high-tax countries on the books. 3. **Intellectual property and royalties**: Companies can set up intellectual property holding companies in low-tax countries, transfer intellectual property such as patents and trademarks to the subsidiaries, and collect royalties from branches in other countries, thereby reducing the overall tax burden. 4. **Debt arrangements**: Companies can borrow funds in high-tax countries and collect interest payments from subsidiaries to low-tax regions. This method can take advantage of the tax deduction provisions for interest in the tax laws of various countries, thereby reducing taxable income. 5. **Tax haven utilization**: Certain countries and regions are considered tax havens (such as the Cayman Islands and the Virgin Islands), and companies can achieve tax deferral or complete tax exemption by setting up shell companies in these regions. 6. **Double non-taxation**: Through loopholes in double taxation agreements, companies can take advantage of inconsistent tax treatments between different countries to achieve double non-taxation. 7. **Corporate inversion**: Some companies relocate their company registration to low-tax countries through mergers or acquisitions to reduce their tax burden. Importantly, while these strategies can reduce tax burdens, they are often subject to ethical, legal and regulatory challenges. For example, some countries already have anti-tax avoidance regulations (such as the BEPS Action Plan) to restrict such arrangements. Therefore, companies need to carefully consider compliance and potential legal risks when using these tax arrangements.