Category: Incorporation

Impact of Mexico’s ‘controlling beneficiary’ rules

From 2022, taxpayers are obligated to obtain, keep and provide to the Mexican tax authorities when so requested, information of individuals who are considered to be the ‘controlling beneficiaries’ of legal entities, trusts and other legal vehicles, such as name, date of birth, gender, nationality, tax residence, tax ID number and marital status. ... - Continue reading

How much capital gains tax you pay in Portugal?

Like many countries, Portugal imposes a capital gains tax on the sale of assets. It only applies to gains made on real estate and investments; personal items are not taxable and inheritances are only subject to a limited form of stamp duty. Your exposure will depend on whether you are resident, how you own the asset and, with property, whether it is your main home. ... - Continue reading

The tide continues to turn for offshore companies.

The case of Development Securities (No. 9) Ltd and other v HMRC [2017] UKFTT 0565 is the latest in a line of cases concerning the UK corporate tax residence of offshore companies. The case once again highlights the difficulties in preserving an offshore company’s non-UK tax resident status, whilst giving… – Continue reading

Eurozone’s big four demand measures against tax avoidance

The four biggest economies in the Eurozone – Germany, France, Italy, and Spain — demand an end to the erosion of their tax base by means of incorporation in states that facilitate tax avoidance. According to the Financial Times, Bruno Le Maire, Wolfgang Schaeuble, Pier-Carlo Padoan, and Luis de Guindos,… – Continue reading

UK: The UK Company: A Tax-Efficient Business Vehicle For International Investors

This article is the third of a series of articles that examines tax aspects of the UK company which make it an attractive international business company, or “IBC”. This generic label, and its acronym, are normally associated with the BVI company, and its international competitors in other offshore financial centres…. – Continue reading

Taxation of foreign companies regarded as ‘resident’ in India

Tax liability under the Income-tax Act, 1961 (‘the Act’) of any person is determined based upon his residential status. A person resident of India is taxable on his income accruing across the globe [see End Note 1] while a non-resident is taxable only on the income accruing or arising or… – Continue reading

UK Budget Anti-Avoidance Measure Will Fail, CIOT Says

A significant cut to the dividend tax allowance announced in the UK Budget will not deter people from incorporating their own business to take advantage of lower corporation tax rates, the Chartered Institute of Taxation (CIOT) has said. The Government will reduce the tax-free dividend allowance, which affects owner managers… – Continue reading

Belize Financial Regulator Warns Against Fraudulent Bitcoin Investment Company

The financial regulator of Central American nation Belize has issued a public warning against XMAXBIT, a company that claims to provide returns for investors by investing in cryptocurrencies like bitcoin. Published on Monday, the Office of the International Financial Services Commission (IFSC), Belize’s financial regulator, has warned users against dealing… – Continue reading

Hong Kong to commence automatic exchange of financial account information in tax matters with Japan and UK in 2018

Hong Kong has signed agreements with Japan and the United Kingdom with a view to commencing automatic exchange of financial account information in tax matters (AEOI) with these two tax jurisdictions in 2018, a Government spokesman said today (October 26). In September 2014, Hong Kong indicated its support for the… – Continue reading

Singapore Issues Guidance On CbC Reporting

The Inland Revenue Authority of Singapore (IRAS) has published detailed guidance on the implementation of a new country-by-country (CbC) reporting requirement in the territory. The guidance, released on October 10, sets out which entities are obliged to report and how to complete and submit a CbC report to IRAS. For… – Continue reading

Ireland: Holding Companies In Ireland – August 2016

Ireland has become a destination of choice for holding companies due to its capital gains participation exemption, generous foreign tax credit system, membership of the EU, ever expanding double tax treaty (“DTT“) network (72 signed, with 70 in effect), lack of controlled foreign companies legislation, thin capitalisation rules and the… – Continue reading

UK offshore companies side-step new transparency rules

Some of Britain’s offshore companies have continued to wriggle out of new transparency restrictions according to research released this weekend. Under rules brought in on 1 July 2016, British companies need to disclose on an annual basis any changes to directors or shareholders – both being deemed “persons of significant… – Continue reading

Tax havens accuse US of ‘hypocrisy’ over tax avoidance

A group of tax havens have accused larger countries like the United States of “hypocrisy” when it comes to cracking down on tax avoidance. With the issue of offshore finance high on the agenda in light of the fall out from the so-called Panama Papers scandal, world leaders convened in… – Continue reading

Tax incentives for small and mid-size companies

Most small and mid-sized companies can qualify for tax incentives if they claim to be developing, engineering, designing, modifying, researching or evaluating new products or product alternatives. Among those incentives is the research and development tax credit. The R&D credit is a way for companies to access cash and reduce… – Continue reading

Canadian Budget Focuses On Tax Compliance

The first Budget tabled by Canada’s new Liberal Government provides for a major crackdown on tax evasion and avoidance, and streamlines the domestic tax credits system. The Budget was delivered by Finance Minister Bill Morneau on March 22, 2016. He told Parliament: “Today, we begin to restore hope for the… – Continue reading

20 Caribbean, Latin American Nations Named Major Money Laundering Countries

Twenty Caribbean and Latin American nations have been named by the U.S. as “major money laundering” countries in the 2016 International Narcotics Control Strategy Report (INCSR) from the U.S. State Department released Wednesday, Mar. 2, 2016. A major money laundering is defined by statute as one “whose financial institutions engage… – Continue reading

Union Budget 2016 – International tax proposals

With the adoption of the BEPS package, OECD and G20 countries laid the foundations of a modern international tax framework under which profits would be taxed where economic activity and value creation occurs. It is now time to focus on implementation of the recommended changes in a consistent and coherent… – Continue reading

A tax haven professes to stand on principle, risking pariah status

PANAMA’S most notorious moment as a haven for tainted cash came with the nationalisation of money-laundering in the 1980s under Manuel Noriega, a military strongman. It has since clamped down on egregious financial criminality, but remains home to thousands of secretive firms and famous for the discretion of its bankers… – Continue reading

The biggest loophole of all

Having launched and led the battle against offshore tax evasion, America is now part of the problem DEVIN NUNES raised eyebrows in 2013 when, as chairman of a congressional working group on tax, he urged reforms that would make America “the largest tax haven in human history”. Though he was… – Continue reading

Australia weighs adoption of new OECD BEPS transfer pricing standards

The Australian Treasury on February 11 opened a consultation on whether Australia should adopt into law final OECD/G20 base erosion profit shifting (BEPS) transfer pricing recommendations. The goverment seeks feedback on the adoption of the BEPS report, Alleging Transfer Pricing Outcomes with Value Creation, which has been approved by G20… – Continue reading

Canada: For Tax Purposes, Do You Know Where You Live?

In tax law, the concept of residency is used to determine tax liability based on whether there is a sufficient connection between an individual or legally recognized entity and a jurisdiction such that the jurisdiction is justified in taxing such individual or legally recognized entity on their worldwide income. Generally,… – Continue reading

All You Need to Know About Estonia’s E-Residency Program

Estonia has become the first country in the world to offer a transnational digital identity. It’s attracted the attention of entrepreneurs and digital nomads worldwide, but there’s still a huge amount of confusion about the benefits of the E-Residency Program and what e-residency actually means. Let’s take a look. What… – Continue reading

Cyprus Yacht Registration – New Preferable VAT Treatment

A. INTRODUCTION On the 13th of March 2012, the Cyprus VAT Authority has launched a scheme making Cyprus one of the most attractive EU jurisdictions for yacht registration. According to this scheme, a Cyprus company can enter into a lease-sale agreement of a yacht with a third party, paying VAT… – Continue reading

Redomiciliation of foreign companies

The redomiciliation of companies (ie, movement of a company incorporated in one jurisdiction to another, retaining its legal character) is not recognised under Chilean law. This means that in order to move to Chile, a foreign company must establish a branch or create a subsidiary there. It cannot move its… – Continue reading

Tanzania: Managing Tax Risks – Double Tax Treaties and Implications to Undertakings of Multinationals

The term double taxation refers to an exposure to tax more than once on the same profit or income. There are two types of double taxation i.e. economic double taxation and juridical double taxation. Economic double taxation is broad and occurs in a situation where an amount of income is… – Continue reading

Estonia cuts impact of tax evasion through incorporation by EUR 210,000 in 3 months

Largely as a result of interaction between the Estonian Tax and Customs Board and entrepreneurs on the subject of incorporation, 157 more people have started to pay payroll taxes and have paid altogether 210,000 euros in such taxes in three months, the tax authority said, cites LETA/BNS. “In connection with… – Continue reading

Cayman copies US tax haven’s limited liability law

Cayman Islands has introduced limited liability company (LLC) legislation that combines the key features of a company and a partnership, intended to increase the structuring options for US investment funds. US clients have reportedly been requesting this legislative development for some time to provide a better match with the Delaware… – Continue reading

PoEM not the only solution

The change in definition of an Indian resident company under the Income-Tax Act—from one whose affairs are wholly controlled and managed in India to one whose Place of Effective Management (PoEM) is in India—and the subsequent draft guidelines are giving anxious moments to votaries of simplifying the investment climate in… – Continue reading

Start-up investment in India to get capital gains tax exemption

PM Narendra Modi also announces a Rs.10,000 crore fund to provide support to innovation driven enterprises New Delhi:In an effort to give a fillip to the start-up ecosystem in the country, the government on Saturday announced its intention to exempt capital gains tax on investments in start-ups and a Rs.10,000… – Continue reading

Chinese bank becomes first to open on Swiss soil

Switzerland took an important step toward becoming a renminbi trading hub on Thursday with its inauguration of a new branch of the China Construction Bank, (CCB), one of the biggest financial institutions in the world. The Zurich branch of the CCB has been authorised by China’s central bank to operate… – Continue reading

British Virgin Islands: The BVI And Cayman Islands Are Tax-Neutral Jurisdictions. What Does This Mean For Your Fund?

The BVI and Cayman are often referred to as “tax neutral” and you might have been told that, for this reason, it would be advantageous to establish your fund in either jurisdiction. What does this actually mean and what does it mean for your fund? Primarily, it means that BVI… – Continue reading

The OECD’s BEPS Project: The Emperor Has No Clothes

With all due respect, the OECD’s BEPS project was a fiasco, accomplishing little of any positive value and opening up a Pandora’s box with its focus on “value creation” in the context of transfer pricing. Despite all the “happy talk” coming out of the OECD and all the talk of… – Continue reading

The changing face of European taxation

World Finance spoke to Thierry Afschrift, founder of Afschrift Law Firm and university professor, about how tax lawyers can respond to a changing European environment In keeping with much of Europe, Belgium’s tax system has been subject recently to a shift of important proportions, as policymakers there look to boost… – Continue reading

British Virgin Islands: 2016 Updates To BVI Business Companies Act

In its continuing effort to keep the BVI Business Companies Act (the “Act”) at the forefront of offshore company law legislation, the BVI Government, in direct consultation with the private sector, has introduced several updates to the Act as follows: To allow weighted voting by directors whereby certain directors may… – Continue reading

Dispelling offshore myths

Although the British Virgin Islands is often seen as an offshore tax haven, a closer look shows such opinions may be overstated There is a stereotypical image of the so-called ‘tax haven’ for ‘shady people to put their money’. While it is true that BVI Finance enjoys warm, sunny weather… – Continue reading

Raising revenue off Caribbean backs

THE COUNCIL OF THE DISTRICT OF COLUMBIA (DC) recently enacted, as part of its budget, provisions that force entities doing business in any of 39 arbitrarily designated “tax havens” to report their income on worldwide combined reporting. Eighteen are Caribbean jurisdictions. A tax haven is defined by the DC code… – Continue reading

Mexican Tax Reforms for 2016

On Nov. 18, 2015, reforms to the Mexican Income Tax Law (MITL), Tax Code, Excise Tax and Federal Income Law for 2016 (collectively, the Tax Reform) were published in the Federal Gazette. The Tax Reform reestablishes measures to promote savings and increase incentives for doing business in Mexico, some of… – Continue reading

CF Industries (CF), OCI N.V. Amend Merger Agreement

CF Industries (CF – Analyst Report) and Netherlands-based fertilizers and industrial chemicals producer – OCI N.V. – said that they have amended their merger agreement originally announced in Aug 2015. Under the modified agreement, the jurisdiction of incorporation and tax residency of the new combined company has been changed to… – Continue reading

US Tax Issues: Ownership of Real Property Abroad

When purchasing a real property overseas, there are situations when it may prove advantageous or even necessary to do so through an offshore corporation, rather than owning the property individually. It is crucial to understand that this can also have significant US tax consequences for US persons. Fortunately, “checking the… – Continue reading

Investing in Morocco

Over recent years, Kingdom of Morocco has created a legal and regulatory framework very attractive for foreign investors. In addition to its political stable environment, a recent series of tax treaties with numerous countries and reforms in almost all of its sectors of activities, in conjunction with its creation of… – Continue reading

Business Brief – Double Tax Agreement – Residence – change of HMRC practice

Following an agreement between the UK and Jersey, HMRC has published an important change of interpretation on residence for treaty purposes. HMRC’s view now is that the better interpretation of residency article in the UK-Jersey Double Tax Agreement 1952 (“UK Jersey DTA”) is that it includes a tie breaker provision… – Continue reading

‘OECD’s tax haven plan is based on what India believes in’

MUMBAI: India has been an active participant in the Base Erosion and Profit Sharing (BEPS) action plan, the final package of which was rolled out by the Organisation for Economic Co-operation and Development (OECD) in October. The action points, set down by the OECD, aim at closing loopholes that enable… – Continue reading

Malta: The Tax Challenges Of The Digital Economy – Article 2

Main principles of direct taxation – Domestic Tax Rules In our second article in a series of articles on the tax challenges of the digital economy, we shall be providing you hereunder with a brief overview of the principles of direct taxation, with a focus primarily on the taxation of… – Continue reading

‘OECD’s tax haven plan on Indian lines’

MUMBAI: India has been an active participant in the Base Erosion and Profit Sharing (BEPS) action plan, the final package of which was rolled out by the Organisation for Economic Co-operation and Development (OECD) in October. The action points, set down by the OECD, aim at closing loopholes that enable… – Continue reading

Base Erosion and Profit Sharing plan is a fair tax treatment for all, says former chairperson of CBDT

x MUMBAI: India has been an active participant in the Base Erosion and Profit Sharing (BEPS) action plan, the final package of which was rolled out by the Organisation for Economic Co-operation and Development (OECD) in October. The action points, set down by the OECD, aim at closing loopholes that… – Continue reading

Change in UK Treatment of Dual-Resident Companies May Affect U.S. Tax Planning

On November 30, 2015, the UK tax authorities at HM Revenue and Customs (HMRC) reached an agreement with Jersey about the interpretation of the company residence tie-breaker provision of the Jersey-UK income tax treaty. After reviewing other income tax treaties that contain similar provisions, HMRC will now take the view… – Continue reading