Lexon Incorporations: Corporate, accounting, trust
Lexon Incorporations: Corporate, accounting, trust
Foreign company as an asset holding instrument

A holding company is a company that holds shares (normally, the majority interest) of other enterprises as its main activity.

A holding company may also keep in its possession other assets such as real estate and securities.

A holding company does not generally carry on standard trading or commercial operations.

Income of a holding company is usually "passive income" such as dividends, interest or royalties.

When registering a holding company it is important to consider all aspects regarding the country of incorporation. The key criteria which must be taken into account in choosing a jurisdiction where to have a holding company registered are as follows:

Popular holding jurisdictions include Cyprus, Denmark, the Netherlands, as well as other countries.

When structuring holding operations the following legal aspects may also be of importance:

EC Parent Subsidiary Directive. In accordance with this Directive a company being a taxpayer in any European Union country may receive dividends from its subsidiary in another European Union country with no withholding tax being levied in such other country.

ЕC Interests and Royalty Directive. This Directive came into effect on 1st January 2005. According to it, the interest and royalty payments shall be exempt from any taxes in any European Union country where they arise provided that the company being a recipient of the payment is a related company as well as being a tax resident of another European Union country.

Additionally, in both of the above cases the company receiving the income must be the final beneficial owner of such income in that it must derive this income for its own benefit rather than as аn intermediary, agent or trustee acting in the interests of a third party.

Arms length principle. This is compliance with the market conditions in that the transaction is performed on the condition that both companies are independent of each other. Benefits under the ЕC Interests and Royalty Directive will not apply to payments for amounts that are above the actual market value.

Lexon Incorporations will provide the incorporation of a holding company in the jurisdiction that optimally conforms to the entrepreneur’s objectives.

http://lexcorp.com/en/corporate/holding_structures/ - Foreign company as an asset holding instrument