Offshore Company Services Offshore Company Services

Offshore company services include a variety of company formation and support services for offshore...

Offshore Countries for Offshore Holding Offshore Countries for Offshore Holding

To register or form an offshore holding in a given location, various conditions should exist to...

Offshore Holding Company Offshore Holding Company

An offshore holding company can be a firm or company that owns shares in other companies. These...

Best Countries for Offshore Holding

Provided that adequate research is done before committing to fully establish an offshore holing in a territory, it is possible to reap the benefits of having an offshore holding.

While offshore havens are generally considered the best countries for offshore holding because of the zero and low tax regime that is established specifically for offshore companies, there are some countries that are not considered offshore havens that are ideal for offshore holding companies and come highly recommended because of certain legislations and policies that are put in place specifically for holding companies, offshore and domestic.

Cyprus is well positioned as one of the best countries for offshore holding for several reasons. Cyprus is a low tax jurisdiction and as a result of its membership in the European Union has become yet more attractive to persons and corporations that feel a greater sense of security with this Cyprus status as a member of the EU. Cyprus companies are subject to a 10% tax rate on income, while withholding tax can be exempted on dividends obtained by a Cyprus parent company from any international subsidiary provided that these dividends qualify for such treatment, but all EU subsidiaries are exempt from withholding tax on dividends without exception. As one the best countries for offshore holding, Cyprus also does not levy any capital gains tax derived on profits or income derived from company liquidation or the sale of securities. Additionally, a non resident shareholder of a Cyprus offshore holding has no tax obligations to Cyprus. Cyprus operates over 40 tax treaties with countries around the globe, and therefore provides a wide scope for Cypriot offshore holding companies in terms of operating under favorable tax conditions.

Spain has been identified as one of these best countries for offshore holding and over the years has become to be viewed as having the fiscal conditions that are suitable for establishing an offshore holding. Spain is named among 8 other European countries with fairly attractive fiscal conditions in this regard. Spain itself offers its own type of holding which is known as the Entidad de Tenencia de Valores Extranjeros or ETVE (Holding Company for Foreign Assets). The ETVE is an ordinary company which is liable to income tax at a rate of 30% like other regular Spanish companies. The ETVE however pays no tax on offshore capital gains and dividends that qualify for tax exemption and is shielded under both the EU Merger Directive and Parent-Subsidiary Directive. The ETVE is taxed based on residency and is considered tax resident. These conditions highlight Spain as one of the best countries for offshore holding, especially given that Spain possesses an extensive treaty network that includes Latin America and the European Union. A Spanish offshore holding can thus be used to direct capital investments towards countries in Latin America by non EU nationals who wish to use this entity for Latin American investments. As an offshore holding, the ETVE has been deemed to be of no threat with regard to tax competition and therefore enables its owners to trade freely without unwanted pressure from other EU governments.

Las but not least, the Netherlands, Switzerland, Malta and Denmark have also been noted as one of the best countries for offshore holding because of the numerous tax treaties that exist between the Netherlands and other countries throughout the world. These tax treaties create the possibility of importing and exporting under favorable tax conditions and receiving exemptions from taxes and charges that are usually placed on remissions from one signatory country to another. This makes it possible to channel and move dividends, interests and profits free from withholding tax and to considerably reduce the tax burden of subsidiaries.

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