Trust Taxation

[inector]

A proper trust structure usually requires a holding company. Let's say it is in Singapore, where the tax is 17%.

Now, you don't own it, the trust owns it, and they are based in let's say Liechtenstein, where the tax is 12.5%.

The Singaporean company does nothing but receives dividends from subsidiaries.

Is it possible for the Liechtenstein trust (foundation) to become place of management for Singapore (so you pay 12.5% instead of 17%)? Is it common?

 

[CyprusLawyer101]

It can be provided the tax residency conditions⁣ of both jurisdictions and potentially the treaty between them ( if it exists) would allow⁢ it.

 

[Martin Everson]

No it doesn't.

 

[mraleph]

Interesting topic 🙂

An elegant one‍ does. Direct control is more often. Not better, efficient nor private though.

A substance must be present for both entities, LI trust and SG holding company. LI tax⁢ benefits come from effective management of SG entity by LI entity.

You should consult appropriate︀ advisor for your idea before commencing anything - it will require nuanced approach due to︁ DTAs and remitance and significant maintenance budget.

 

[inector]

This seems‌ to be the case - Oceanic Trust Case

If South Africa and Mauritius had these‍ problems, I can only imagine what would happen in EU...

 

[mraleph]

I've read the case and it appears the declatory rulling was requested post‍ factum and post festum where the factual aspect is disputable so SAR court declined to⁠ decide.

Ergo, you should request tax rulling at appropriate time - before the structure setup.⁤ Those rullings - like in CH - can be obtained from SG tax authority. I'm⁣ not certain whether LI authorities have same regime, but there comes the tax advisor -⁢ above all, you do not actually need special tax regime for LI entity so the︀ only setup should be done for SG one.