Offshore company for music royalties

[Max101]

I'm based in the UK. A big portion of my income comes from music royalties. I expect this to grow in the coming years.

I believe in the past there was a route via the Netherlands and Antilles that avoided all taxes but this has been closed.

Are there any current options that don't involve moving to a very hot country (Ibiza excluded)?

Does the Cyprus ipbox scheme apply to music royalties?

 

[JustAnotherNomad]

Whatever you do, make sure you really understand the UK CFC rules.

 

[Marzio]

Max101 said:
Does the Cyprus ipbox scheme apply to music royalties?
Click to expand...

Here you'll find the list of qualifying IP assets: Cyprus IP Box Regime - Intellectual Property Law - Taxes and Accounting

Max101 said:
in the past there was a route via the Netherlands and Antilles that avoided all taxes but this has been closed.
Click to expand...

Is there a specific country where are you receiving music royalties from?

 

[Gediminas]

Max101 said:
I'm based in the UK. A big portion of my income comes from music royalties. I expect this to grow in the coming years.

I believe in the past there was a route via the Netherlands and Antilles that avoided all taxes but this has been closed.

Are there any current options that don't involve moving to a very hot country (Ibiza excluded)?

Does the Cyprus ipbox scheme apply to music royalties?
Click to expand...

Hey,

Dutch IP box regime was famous for many years since they apply very low taxes on IP Box companies, also Dutch treaties did not allow to apply withholding tax in the countries where royalties were paid.

Cyprus's IP box regime was even more effective. However, these regimes nowadays are applicable only for IP which is created in these countries (local employees, etc.) but not for contributed or acquired IP.

When you live from IP, you need to combine two things: first paying company should not apply high withholding tax (for example if a US company pays royalties to Cyprus it would apply lower WHT than to royalties paid to UAE because of international treaties, it means even you have zero tax UAE company it will help to safe anything).

Second, how royalties are taxed at the corporate level. If you are flexible to move, I suggest moving to a country that does not tax passive income (MT, CT, PT, etc.) and then setting up an offshore entity that will receive royalties.

On the other hand IP companies nowadays are often subject to extensive substance requirements, so you should take a look at jurisdiction carefully.

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[Marzio]

Gediminas said:
I suggest moving to a country that does not tax passive income (MT, CT, PT, etc.)
Click to expand...

MT = Malta
PT = Portugal
CT = ??