Malta 5% structure – reduce fixed cost and unshell (ATAD3) proof it

[Anonymous1234]

I agree with you, in spain︍ the only important thing is having a genuine activity, rest you can have a lux︎ fund and take dividends tax free or any capital gain outside spain will not be️ taxed nor needs to be declared in the tax return.

Well noted about Malta, I‌ will speak to my advisor at the earliest and resolve this big issue.

As far‍ as dubai is concerned, just be careful with your setup, it's a whole different s**t⁠ we are talking about if one gets into any legal issues there. All the best.⁤

I agree, i am trying to explore what realistic⁢ options we have on earth other than migrating to Mars and paying zero taxes.

 

[Anonymous1234]

What are the options amongst‍ 2nd/ 3rd world countries??? I have just started a new thread to solve this issue.⁠

 

[JackAlabama]

basically all 😉 Pick the one‍ you like the most and which fits you, learn the hang around there and enjoy⁠ life.

 

[Anonymous1234]

LOL, I am basically‍ clueless, can you suggest some places you are inclined towards?

 

[JackAlabama]

wont help much since im not you. largely depends on my‍ mood, but the regions are africa, some latin american ones and southeast asia.

 

[Anonymous1234]

In south east Asia I believe Malaysia is the only country which does not tax foreign‍ income and in africa i guess its only mauritius, in Latin America I believe it's⁠ paraguay and uruguay

 

[meir13]

Africa no tax no foreign income⁠ also available in Namibia and Malawi. Plus Philippines in Asia for non citizens.

 

[Anonymous1234]

Thanks for the info

 

[uplana]

If you trade as a private‍ person and only in stocks and crypto, but not do any day trading, would you⁠ be considered professional?

Would you could do the same just as a holding company in⁤ Switzerland which only hold stocks and crypto and trade it only say once a month?⁣

 

[PhantomOf ThePits]

@uplana

It depends very⁤ much on the canton.
Some cantons you may be considered a 'gewerbsmaessiger Wertschriftenhaendler' if you⁣ use leverage or derivatives for speculation (instead of only for hedging),
some other cantons they⁢ may consider how much money you make with another, non trading related job.
Some cantons︀ check how many trades you do per month

Mostly they evaluate also your intention if︁ its your only job to trade or the scale -- if you make 100k with︂ your job but 500k with stocks (even though not day-trading, but more than handful trades︃ per month), you may run into to be considered professional.

If you're considered professional, you︄ need to pay income taxes on your profits as well as around 10% social charges︅ on top.
Depending on the cantons and how much money you make, this can make︆ quite a difference.
Example for 500k in Zug you pay 20% income tax vs Geneva︇ 40% (both in addition around 10% social charges for active trading)

A way around that︈ is to create a GmbH/AG company in a low tax canton like Zug/Schwyz/Lucerne and trade︉ with that and pay corp tax in low 10s.
And then, depending if you take︊ out your money via salary or dividends, you're total tax leakage may be around 25%︋ all-in.

Setting up a company vs private trading depends very much on the individual case,︌ canton, how much money you make, how active you are and also very much who︍ in the Swiss tax office is looking at your case.....

Google for topic 'gewerbsmaessiger Wertschriftenhaendler'︎

 

[uplana]

I already own a AG in Zug with 3 million CHF paid in share capital‌ where I'm the director and shareholder, so that would be fine.

Compared to Malta which‍ is the topic of this thread, which destination is better?

 

[Borg]

I see some⁢ great risk in residing in Malta and using 5% holding structure since the local tax︀ authority can easily re-qualify the taxation of dividend payments from the operating company.
Overall, what︁ is the benefit of Malta compared to ordinary offshore havens? What advantage does it give︂ for the exorbitant fees for secretarial and audits?

 

[burden]

I agree with @Borg and his questions which I would like to know if possible?‌ I have not heard anything bad about Malta as a destination for a forex or‍ stock trader yet.

 

[PhantomOf ThePits]

Usually a Maltese Trading Company with a CY or Gib Holding as 100% owner makes‌ it difficult to onboard with several brokers and bank accounts to on/off ramp.

Depending on‍ how much money you trade or how active you are, other structures may be more⁠ beneficial.
But keep in mind the CFC rules, like you're the director/owner of an offshore⁤ structure, will create tax liabilities in lots of jurisdictions (even NonDom countries like Malta if⁣ you dont have enough substance abroad.

Depending what your other income from your other business︂ vs your trading income is, this may not be an issue for you if you're︃ not so active.

Best is, speak with the Steueramt of your residence canton through your︄ Treuhaender and try to get a Tax Ruling -- then you're on the safe side︅ for your individual case

 

[Anonymous1234]

As someone who has his foot in Malta and has spent several thousands in legal‌ advise, maltese tax authorities are looking more into local source income, there is a component‍ of private asset management which you can say that you are managing your own capital⁠ and pay your minimum tax of 5k euros for non dom status and exemption from⁤ foreign source income and you are fine, formation of companies for trading is a different⁣ issue and you are opening a can of worms in terms of PE and CFC.⁢

Malta is attractive from a location standpoint and away from Russia and Ukraine and Israel︀ gaza issue, being in the EU and euros as currency and english being one of︁ the main language, again I am comparing it with other EU countries then Malta is︂ hard to beat and weather is a big plus. The downsides is heavy traffic and︃ it's a small island.

If Malta was like Spain, Germany and Italy then there would︄ be no hedge funds incorporated in Malta.

Again, I have never heard from anyone who︅ has non dom status in malta and is being aggressively audited and chased by the︆ Maltese tax authorities, doing things by law and paying your minimum tax of 5k euros︇ and keeping a low profile is always best no matter where you live and most︈ importantly covering your bases in terms of grey areas and legal uncertainty.

 

[Anonymous1234]

Again, it's a different issue where some people just don't want to pay anything and‌ these are the people who get into trouble with the tax authorities, if you are‍ trading in the US and living in malta with your capital, you pay your fair⁠ share of 5k euros minimum tax, I don't see you are breaking any law, certain⁤ interpretations are provided by certain law firms because if you don't form a company then⁣ how will they make money?

Again, if anyone has any source to prove that an⁢ active trader trading in non maltese exchanges from Malta has been challenged by the Maltese︀ tax authorities claiming it is active income and not capital gains then please provide proof,︁ that can be interesting.

 

[Borg]

Just one remark regarding the non-dom︂ status, there is no mention of that in any laws in Malta. Instead, they use︃ remittance basis for your income, i.e. smth that was not remitted to Malta should not︄ be taxed there. Overall, it is not possible to qualify somehow for non-dom status, you︅ can only think of yourself as having one. And than you would need to prove︆ that in the case of any problems with tax authorities. Given that Malta is in︇ the EU, any issues with their authorities put you in quite uncomfortable position across the︈ whole Europe IMHO.

 

[RAGAV]

Hey A1988,︁ I am interested in moving to the UAE to trade (stocks, equity derivatives, futures, options)︂ on US and Europe exchanges using my personal funds. My trading style is very active︃ and involves lot of transactions daily. I am an Indian citizen so would need a︄ residence visa to move there.

As you have traded futures actively in US exchanges from︅ UAE for few years and familiar with the rules there, can you answer the following︆ questions?

1. Can I trade in my own account without any license? [I was thinking︇ of taking a freelancer visa for residence and trade in personal account]
2. If license︈ is required, which freezone and license is most suitable for active derivative trading?

 

[Anonymous1234]

Usually licenses are cheaper outside dubai, rak or sharjah or︂ even al ain. You would need a company which will sponser your visa anyways so︃ better to use a decent freezone. There is an activity of holding shares in freezone︄ which is tax free but there is a ceiling of 1m aed and then 9%︅ tax. Dubai is a great place to live for indians due to huge population and︆ also close proximity to India.

But, do your own research and talk to as many︇ consultants as you can before you decide on one. Better to use big ones as︈ they are expensive but reputable.

Goodluck.

 

[Anonymous1234]

Technically active trading does not qualify as holding shares,︁ hence you will pay 9% over 1m aed, which in itself is decent amount. Dubai︂ is not malta or cayman islands anymore.