International Tax Planning for Trading Companies

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Slides of the Webinar "International Tax Planning for Trading Companies" presented by NEWCO. In this webinar, the concept of trading is explained, as well as the key factors normally considered when choosing a jurisdiction, namely safety and credibility, transparency, human resources and know how, operational costs, infrastructures and tax regime. The specific advantages of Madeira and Malta for international trading companies are also outlined.

Transcript of International Tax Planning for Trading Companies

  • NEWCO All rights reserved 2014 International tax planning for trading companies We know how
  • Topics 1. Concept of trading 2. Key factors Credibility and security Transparency Human resources and know-how Operational costs and infrastructures Tax regime 3. Trading in Madeira 4. Trading in Malta 5. NEWCO 2
  • 1. Concept of Trading 3
  • 4 Concept of international trading Purchase and sale of goods or provision of services involving more than one country: Import and export operations or operations within the EU Triangular operations or those involving stock management With or without manufacturing Provision of services at the international level Operations with related entities vs operations with third parties Broad concept of trading: passive income vs active income Concept of trading
  • 5 2. Key factors
  • 6 Key factors | Credibility and security Ecient and pro-business legal system Social and political stability Security Freedom of establishment and capital control policies Sector specic licencing and regulations Labour law European directives and compliance with EU law Consistency in the legislation and granted benets Possibility of obtaining rulings Key factors
  • 7 Key factors | Transparency Black lists Compliance with OECD criteria on transparency and exchange of information Key factors
  • 8 Key factors | Human resources and know how Availability of qualied human resources Languages University and R&D resources International business environment Capability and capacity to import know-how Experienced and ecient professional services providers Soundness, sophistication and eciency of the nancial system Culture Key factors
  • 9 Key factors | Operational costs and infrastructures Cost of wages and other labour costs Cost of supplies and external services Cost of living (real estate, food, transportation and so on...) Road network Telecommunications Air and maritime transportation Currency and exchange costs Fiscal costs Key factors
  • 10 Key factors | Tax regime Corporate income tax VAT and other indirect taxes Withholding taxes Double taxation agreements Personal taxation Social security Taxation of expatriates Exit taxes Key factors
  • 11 Key factors | Tax regime Eciency and attitude of tax administration Anti-abuse rules Tax havens Transfer prices GAAR Other Key factors
  • 12 3. Trading in Madeira
  • Trading in Madeira 13
  • 14 Trading in Madeira Trading in Madeira
  • 15 Madeira companies benet from the following tax regime: 5% corporate income tax rate (IRC) Withholding tax exemption Tax credit for international double taxation Capital gains tax exemption Exemption from local taxes Exemption from stamp duty Exemption from taxes on real estate (IMT and IMI) Exemption from notary and registration fees Trading in Madeira | Tax regime Trading in Madeira
  • 16 Trading in Madeira | general requirements Must be licensed to operate within the scope of the IBC by the regional Government of Madeira Tax exemption for payments to non-residents in Portugal or other entities operating within the scope of the IBC Reduced corporate income tax rate on income obtained with non-residents in Portugal or with other entities operating within the scope of the IBC Exemption from Real Estate Transfer Tax (IMT) and Municipal Property Tax (IMI) only for property located in Madeira used for the companys business Trading in Madeira
  • 17 Trading in Madeira| substance requirements The company must have at least one paid employee or director (full- time or part-time) on its payroll If the company employs fewer than 6 employees (or directors), during the rst two years of activity, it must make a minimum investment of 75 000 in the acquisition of tangible or intangible xed assets NOTE: - Requirement 1 must be fullled within 6 months. -Requirement 2 must be fullled within 2 years. 2 1 Trading in Madeira
  • 18 Trading in Madeira| ceilings Trading in Madeira Tax benets have limits, depending on the number of employees (or directors) under the above referred conditions: If taxable income exceeds the limit, the excess will be taxed at 23% (general regime in Madeira)
  • 19 Double taxation treaties Trading in Madeira
  • 20 Madeira oers investors many other advantages: Advance rulings Non-resident company branch oces Redomiciliation of companies Transfer pricing Special regime for the Industrial Free Trade Zone Special regime for non-habitual residents Golden visa Trading in Madeira| other advantages Trading in Madeira
  • 21 Trading in Madeira Trading in Madeira
  • 4. Trading in Malta 22
  • Trading in Malta 23
  • Trading in Malta 24 Trading in Malta
  • 25 Trading in Malta | tax regime Trading in Malta
  • 26 Trading in Malta | Eective tax rates Trading in Malta
  • 27 Double taxation treaties Trading in Malta
  • 28 Maltas tax regime oers many other advantages: Withholding tax exemption on the payment of royalties, interest, dividends or proceeds of liquidation Exemption of Capital Gains tax Flexible and straightforward anti-avoidance rules Advance rulings Possibility to redomicile companies from and to Malta Trading in Malta| other advantages Trading in Malta
  • 29 Maltas tax regime oers many other advantages: The share capital of the companies can be denominated in any convertible currency Flexibility in the choice of the tax year Malta accounting standards based on IFRS Stamp duty exemption Group tax relief Malta has no capital tax or wealth tax Trading in Malta| other advantages Trading in Malta
  • 30 Trading in Malta Trading in Malta |1| Corporate income tax
  • 31
  • NEWCO Full service corporate service provider in Madeira and Malta 23 years of experience Strategic values: Know-how, customer satisfaction, integrity, service excellence and innovation 32
  • NEWCO NEWCO ensures that its clients receive all the necessary support for eectively establishing their companies in Madeira and Malta, namely with: Company incorporation and registration Supply of the respective registered oce and related services companies management and administration Tax compliance, legal, nancial, tax and accounting assistance, consultancy and assistance in the creation of investment projects Services with the purpose to facilitate the setting-up in Madeira and Malta (oces, equipment, human resources) 33
  • NEWCO 34 89% of clients Consider that NEWCO has a wide knowledge of all issues related to their jurisdiction 87% of clients Recognize that NEWCO oers leading services in its sector of activity 93% of clients State that they are highly likely to recommending our company to their peers and partners Honest and Professional. Giuseppe Luongo President YOUTHSTREAM GROUP Monaco I consider the understanding of customer needs and willingness to accommodate and nd appropriate solutions the key dierentiator of NEWCO service. Lus Franco Vice-President, SurveyMonkey Palo Alto, EUA
  • 35 Ttulo 31 THANK YOU. Frederico Gouveia e Silva frederico.silva@newco.pro skype frederico.silva.newco M. (+351) 967 819 308 www.newco.pro Follow our Blog in www.newco.pro/blog