In a scenario where the following occurs.
1) Corp registered in Zero Tax country.
2) Shareholders in Territorial Tax Country (which discontinues) and in Zero Tax country [0 Salary/Income from Company]
3) Establish new main Office in Zero Commercial Tax Country with local operation(s).
4) Territorial Tax Country shares transferred to a Offshore Holding Company in Zero Tax Country, for Dividends.
In this scenario, The holding company would receive Dividends every x yrs, the UBO of said holding company doesn't receive income from operational company, nor do they own it thus is not liable for tax based on the companies revenues/profits, the operational side gives it substance, and likewise has low to zero tax.
The shareholders are of nations that a) don't charge tax if non-resident (home country), or b) in a country where there is zero tax, or c) in a country where they have to pay tax [in the future] due to owning a company overseas based on it's revenues/profits, now as they hold only a holding company (shares) and exercise no day-to-day voting/management, they should in theory just be a localised holder of a company that holds equity in a asset overseas.
In this scenario, would the shareholder in the discontinuing territorial tax country have a barrier from the operational company, but have exposure to the holding company only? Which can be offset by bi/tri-annual non-residency (under 180 days) to harvest their dividends in a legal tax free manner as they arrise?
* How would that work also in mind with employees spaced across the world (currently most have transitioned to service/contractors or are).
The scenario, isn't to avoid income tax per-se (legal), but to avoid being taxed for the revenues/profits of the company which are reinvested into the organisation or paid out in dividends (planned every 5-10yrs).
Note shareholders have little interest in harvesting the business for income or dividends annually, with an approach to harvest dividends in rate hike years (re-fi cycles), when all corporate treasury positions are liquidated, all ongoing services/products revenues re-direct to treasury pool.
Should add - most of the business is automated, AI driven.. (products/services), and a greater part of treasury management.
Last edited: Oct 1, 2023
1) Corp registered in Zero Tax country.
2) Shareholders in Territorial Tax Country (which discontinues) and in Zero Tax country [0 Salary/Income from Company]
3) Establish new main Office in Zero Commercial Tax Country with local operation(s).
4) Territorial Tax Country shares transferred to a Offshore Holding Company in Zero Tax Country, for Dividends.
In this scenario, The holding company would receive Dividends every x yrs, the UBO of said holding company doesn't receive income from operational company, nor do they own it thus is not liable for tax based on the companies revenues/profits, the operational side gives it substance, and likewise has low to zero tax.
The shareholders are of nations that a) don't charge tax if non-resident (home country), or b) in a country where there is zero tax, or c) in a country where they have to pay tax [in the future] due to owning a company overseas based on it's revenues/profits, now as they hold only a holding company (shares) and exercise no day-to-day voting/management, they should in theory just be a localised holder of a company that holds equity in a asset overseas.
In this scenario, would the shareholder in the discontinuing territorial tax country have a barrier from the operational company, but have exposure to the holding company only? Which can be offset by bi/tri-annual non-residency (under 180 days) to harvest their dividends in a legal tax free manner as they arrise?
* How would that work also in mind with employees spaced across the world (currently most have transitioned to service/contractors or are).
The scenario, isn't to avoid income tax per-se (legal), but to avoid being taxed for the revenues/profits of the company which are reinvested into the organisation or paid out in dividends (planned every 5-10yrs).
Note shareholders have little interest in harvesting the business for income or dividends annually, with an approach to harvest dividends in rate hike years (re-fi cycles), when all corporate treasury positions are liquidated, all ongoing services/products revenues re-direct to treasury pool.
Should add - most of the business is automated, AI driven.. (products/services), and a greater part of treasury management.
Last edited: Oct 1, 2023