When is the utilisation of a foreign holding company recommendable?
There is a number of situations when the set up of a holding company could be of advantage including; • When an investor strives for; – Avoidance, reduction or deferral of home country tax; – Reduction of foreign dividend withholding tax. • When confidentiality of ownership is required. • When an investor wishes to safeguard the ownership outside the country of investment. • When a joint venture must be formed by parties from different countries. For the international businessman or company active in cross-border investments there are several tax issues that need to be examined before making the investment. Perhaps the two most important questions are: • How can I transfer profits out of the country of investment in the most tax efficient way? • When I wish to exit my investment, partly or wholly, how can I minimize the profit tax payable on the capital gain? The answer to the above two questions can be the setting up of a holding company in a foreign country. The main functions of hol
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