Given that within the European Union there are no withholding taxes on IP royalties between member states, we can suggest a number of countries where royalties are particularly advantageous.
CYPRUS The intellectual property royalties tax regime in Cyprus has changed as a result of the recommendations of the Organization for Economic Co-operation and Development (OECD) Action Report 5 and the Ecofin Council conclusions published on 8 December 2015. Legislation has been changed to limit the companies that can benefit from research and development (R&D) exemptions, but the tax rate in Cyprus is still one of the most favorable in the EU for foreign companies using Cyprus intellectual property want to license -resident companies (intermediaries), where this right is then sub-licensed to the end user. Overall, the effective tax on IP royalty income should be less than 2.5%.
IRELAND In 2015 Ireland introduced an effective corporation tax rate of 6.25% on intellectual property income based on an allowance for research and development costs borne by the company. By linking the two components in this way, Irish law encourages companies to conduct R&D directly within the EU – leading to the creation of intellectual property – while discouraging them from acquiring licenses without directly committing to R&D.
BELGIUM Belgium has introduced a tax system that favors those with income from acquired copyrights. This tax regime can have many different applications and can be used to protect artworks as well as a useful tax break for IT developers. Income from IP rights royalties is taxed at 15%. This income is not taken into account when calculating social security contributions. In addition, these taxes are reduced by 50% for imports due to the application of standard import costs. The first €15,000 that a copyright owner earns in a year is therefore taxed at 7.5%, and the next €15,000 at 11.25%. This tax system applies to people with a total annual income of up to 56,450 euros.
LUXEMBOURG In general, corporate tax in Luxembourg is 29.22%, but for IP licensing income it can be as low as 5.8%. This is due to an 80% corporate income tax exemption. Interestingly, this exemption also applies to companies that have registered a patent for use in connection with their own business, which then calculate a notional net income as if they had received the licensing income.
ITALY Italy is a larger market compared to the other countries discussed and can be a very attractive place for a company to invest in R&D since 2015 companies have been able to deduct intellectual property income from their taxable income base. The tax deduction was set at 30% in 2015, 40% in 2016 and 50% from 2017. Businesses will therefore enjoy a significant tax rebate by reducing their taxable income.
THE NETHERLANDS Since 2010, IP income has been taxed at only 5% in the Netherlands. Except for patents, there is no income limit. Patent holders can actually have access to this tax regime if their share of the expected revenue is between 30% and 70%, taking into account the total combined revenue from patents and other sources. These rates also apply to foreign companies owning intangible assets or companies that have received research and development accreditation from the Dutch Ministry of Economic Affairs if they are owners of software IP or trade secrets. The only other caveat to this favorable tax regime is that it doesn't apply to marketing and branding-related assets.
Canada is considered a developed country. A nation's level of development is determined by a number of factors including, but not limited to, economic prosperity, life expectancy, income equality and quality of life. As a developed country, Canada is able to provide its citizens with social services such as public education, healthcare and law enforcement. Citizens of developed countries enjoy a high standard of living and longer life expectancy than citizens of developing countries. Each year, Canada exports about $458.7 billion and imports about $471 billion. 6.4% of the country's population is unemployed. The total number of unemployed people in Canada is 2,365,041. In Canada, 9% of the population lives below the poverty line. The proportion of citizens living below the poverty line in Canada is low, indicating that the country has a stable economy. Investors should consider Canada as a safe location for investments and other financial ventures. Government spending on education is 4.9% of GDP. The country's Gini index is 32.1. There is good equality in Canada. The majority of citizens in Canada fall within a narrow income range, although in some cases there can be significant differences. Canada has a Human Development Index (HDI) of 0.902. Canada has a very high HDI value. This suggests that almost all citizens are able to lead desirable lives due to social and economic support; Citizens with low living standards receive help and support and have the opportunity to advance in society. The Global Peace Index (GPI) for Canada is 1.287. Due to the strong law enforcement presence and high level of social responsibility, Canada is very safe by international standards. The Strength of the Legal Rights Index for Canada is 9. Overall, it is considered fairly strong – insolvency and collateral laws can protect the rights of borrowers and lenders quite well; Credit information is plentiful and easily accessible.
Currency The currency of Canada is Canadian dollar. The plural form of the word Canadian dollar is dollars. The symbol used for this currency is $, and it is abbreviated as CAD. The Canadian dollar is divided into Cent; there are 100 in one dollar.
Credit rating The depth of credit information index for Canada is 8, which means that information is mostly sufficient and quite detailed; accessibility is not a problem. According to the S&P credit-rating agency, Canada has a credit rating score of AAA, and the prospects of this rating are stable. According to the Fitch credit-rating agency, Canada has a credit rating score of AAA, and the prospects of this rating are stable. According to the Moody's credit-rating agency, Canada has a credit rating score of Aaa, and the prospects of this rating are stable.
Central bank The prime lending rate of Canada's commercial banks is 3. In Canada, the institution that manages the state's currency, money supply, and interest rates is called Bank of Canada. Locally, the central bank of Canada is called Banque du Canada. The average deposit interest rate offered by local banks in Canada is 0.6%.
Public debt Canada has a government debt of 49.6% of the country's Gross Domestic Product (GDP), as assessed in 2012.
Tax information The corporate tax in Canada is set at 15%. Personal income tax ranges from 0% to 50%, depending on your specific situation and income level. VAT in Canada is 13%.
Finances The total Gross Domestic Product (GDP) assessed as Purchasing Power Parity (PPP) in Canada is $1595975 billion. The Gross Domestic Product (GDP) assessed as Purchasing Power Parity (PPP) per capita in Canada was last recorded at $43 million. PPP in Canada is considered to be below average when compared to other countries. Below average PPP indicates that citizens in this country find it difficult to purchase local goods. Local goods can include food, shelter, clothing, health care, personal care, essential furnishings, transportation and communication, laundry, and various types of insurance. Countries with below average PPP are dangerous locations for investments. The total Gross Domestic Product (GDP) in Canada is 1,838,964 billion. Based on this statistic, Canada is considered to have a large economy. Countries with large economies support a wide variety of industries and businesses, providing ample opportunities for investment. Large economies support a substantial financial sector, making it easy to organize investments and financial transactions. It should be very easy to find good opportunities for investment in Canada. The Gross Domestic Product (GDP) per capita in Canada was last recorded at $50 million. The average citizen in Canada has low wealth. Countries with low wealth per capita often have slightly lower life expectancies and lower quality of living among citizens. It can be difficult to find highly skilled workers in countries with low wealth, as it is occasionally difficult for citizens to obtain the requisite education needed for specialized industries.
Before incorporating a company or even choosing a jurisdiction, you must plan a corporate structure for your business and, based on that, determine the purpose of the business you wish to incorporate. It is important to understand the business structure of your company as this will determine the jurisdiction and type of business you choose to best serve your needs.
Since different legal entities are usually subject to different tax regulations, it is important to have a clear vision for your company, including its scope of activity and corporate structure. Choosing the right legal form for your business is crucial for tax planning purposes; otherwise you risk additional costs that could easily have been avoided. In addition, some types of companies have certain restrictions on accepting new business partners or third-party investors, which can be problematic if you plan to work with invested capital. One of the most important aspects is the liability of the owners: different legal entities have different levels and mechanisms of liability for the business owner in relation to the company's relationships with third parties. In order to avoid unnecessary risks, we strongly recommend that you think carefully about your choice of legal form.
A company’s legal structure refers to its internal composition and its management and supervisory bodies as well as the liability of the owners in relation to third parties. On this basis, we can offer you the following legal company structures:
Limited liability company (LLC) Joint-stock company (JSC) Limited partnership (LP) Limited liability partnership (LLP) Foundation General partnership (GP) Branch office Representative office Trust Confidus Solutions can provide you with in-depth legal consultation regarding business and tax planning strategies, as well as advising on a suitable legal structure for your company. As each type of entity has its own benefits and disadvantages, we strongly recommend that you contact us before proceeding with the company formation procedure.
The monthly minimum wage in Vietnam depends on the administrative area. Vietnam has a public debt equivalent to 48.2% of the country's gross domestic product (GDP), estimated in 2012. In terms of consumer prices, Vietnam's inflation rate is 6.8%. The currency of Vietnam is the Vietnamese Dong. The plural form of the word Vietnamese dong is dongs. The symbol used for this currency is ₫ and is abbreviated as VND. The Vietnamese dong is divided into hao; There are 100 in a dong. Every year, consumers spend around US$62,424 million. The ratio of consumer spending to GDP in Vietnam is 0.04%, and the ratio of consumer spending to world consumer market is 18%. Corporate income tax in Vietnam is 20%. Personal income tax ranges from 5% to 35% depending on your specific situation and income level. VAT in Vietnam is 10%. In 2013, Vietnam received US$4115.7 million in foreign aid. In 2014, foreign aid amounted to $3595.5.
Gross domestic product Total Gross Domestic Product (GDP) valued as Purchasing Power Parity (PPP) in Vietnam is US$512,582 billion. The gross domestic product (GDP) per capita calculated as purchasing power parity (PPP) in Vietnam was last seen at $5,312,218. PPP in Vietnam is considered very good compared to other countries. A very good PPP shows that citizens in this country find it easy to buy local goods. Local goods can include food, shelter, clothing, healthcare, personal hygiene, essential furnishings, transportation and communications, laundry, and various types of insurance. Countries with very good PPP are safe investment locations. The total gross domestic product (GDP) in Vietnam is 171,222 billion. Based on this statistic, Vietnam is considered to be medium strong. Middle economy countries support an average number of industries and investment opportunities. It shouldn't be too difficult to find worthwhile investment opportunities in mid-sized economies. Gross Domestic Product (GDP) per capita in Vietnam was last recorded at $1,774,484. The average citizen in Vietnam has a very high level of wealth. Countries with very high per capita wealth have a longer life expectancy and a very high standard of living. Highly skilled labor can be found in many industries and labor is very expensive in these countries. Very wealthy countries offer safe investment opportunities as they are often backed by a diverse and thriving financial sector. The annual GDP growth rate in Vietnam averaged 5.5% in 2014. According to this percentage, Vietnam is currently experiencing significant growth. Significant growth countries offer the best opportunities for a significant return on investment, as the GDP growth rate is the most important indicator of economic health. As GDP grows, so do businesses, jobs and personal income.
Low Maintenance Cost Territories are jurisdictions with particularly favorable tax systems where the annual maintenance costs of the company are lower. An effective tax planning strategy often revolves around these jurisdictions, as low taxes and maintenance costs are among the most effective and straightforward cost-cutting tools for any business.
Company maintenance
In general, company maintenance includes any operations that ensure a business is active in its day-to-day endeavours. In addition, many favourable tax jurisdictions require every international company to undergo a company renewal procedure on an annual basis, by submitting a renewal application and paying a certain fee to the state. In terms of tax planning, company maintenance is normally understood as referring to the expenses associated with paying taxes, state fees, stamp duties, charges and any other costs that may arise from operating a company. These include, but are not limited to:
Taxes
Import/export duties
Salaries
License fees
Office rental
Stamp duties
Annual renewal fee
Notary fees
State fees
Maintenance usually does not include any expenses directly related to business transactions, such as the cost of raw materials to be used in production or the purchase of goods for resale.
Depending on the jurisdiction, company maintenance can either be the biggest source of expenses (especially due to taxes and renewal fees) or a barely noticeable cost of conducting a profitable business. This is the main reason why jurisdictions with low maintenance costs are so popular with companies seeking to optimise their taxes.
Steps to maintaining a businessThe first step to effective business continuity is financial planning, including tax planning. A company needs to identify its biggest source of costs and then find a way to gradually reduce those costs. One of the primary goals of effectively maintaining a business is to reduce its tax burden and annual renewal fees. The second step is to choose a jurisdiction with low maintenance costs and an advantageous tax regime. Confidus Solutions is happy to share our expertise on the matter to help you analyze the options and select the best jurisdiction to incorporate. The third step is to move the actual company or incorporation to the jurisdiction of your choice. The details of this process may vary by jurisdiction and legal business structure, so each company should carefully consider which business structure is most beneficial in its particular case. In the long term, maintenance costs are mainly related to wages, taxes and equipment. Wages are effectively determined by the cost of labor in each jurisdiction, which in turn is affected by work culture, levels of education and skills, level of competition, and so on. Taxes depend on the legal business structure and the activities undertaken by a company - some will require licenses and patents that need to be renewed periodically with costs. Finally, the supplies needed depend on the business, but typically include rent (providing premises), utility bills (providing heating, electricity, water, etc.), and supplies such as petrol and office supplies.
Key Benefits of the Panama Private Foundation Establishing a private foundation in Panama offers the following benefits to its owners.
Confidential: Beneficiary names and addresses are not available to the public Tax Exempt: No taxation in Panama and no taxation on worldwide income Separate legal entity Simple structure: founder and beneficiary can be the same person; no obligation to appoint officers or directors Out of reach of creditors No annual accounts or auditing requirements
The Panama foundation is a type of private foundation specifically designed as an asset protection tool. Introduced by the Panamanian Government in 1995 (through the Private Interest Foundation Law), it is based on the principles of Swiss, Luxembourg and Liechtenstein family foundations.
The most obvious advantage of the Panamanian private foundation is that it is a distinct legal entity, independently capable of exerting its rights, executing agreements, acquiring property, etc.
On the other hand, the difference between an offshore limited liability company and a private foundation is that the latter does not engage in commercial activity and cannot be used for trading purposes. Nor is it to be confused with a corporation, which has owners and members.
However, a Panamanian private foundation can participate in investment activities: real estate, holding shares, bonds, patents, interests, stocks, etc.
Usually, a Panamanian private foundation is established for a specific purpose, according to which an individual or a group will benefit from the foundation. The Panama charitable public foundation is used for charitable purposes, whereas a Panama private interest foundation will most likely be set up in order to preserve and safeguard the inheritance of assets by family members or other individuals.
Before starting a business or even choosing a jurisdiction, you need to plan a corporate structure for your business and based on that determine the purpose of the business you wish to start. It is important to understand the business structure of your company as this will determine the jurisdiction and type of company you choose to best meet your needs.
Since different legal entities are usually subject to different tax regimes, it is important to have a clear vision for your business, including the scope of your business and corporate structure. Choosing the right legal form for your business is crucial for tax planning purposes; Otherwise you risk additional costs that could easily have been avoided. Also, some types of companies have certain restrictions on accepting new business partners or third-party investors, which can be a problem if you plan to work with invested capital. One of the most important aspects is the liability of the owners: different legal entities have different levels and mechanisms of liability for the business owner in relation to the company's relationships with third parties. In order to avoid unnecessary risks, we strongly advise you to think twice before choosing a legal form.
A company’s legal structure refers to its internal composition and its management and supervisory bodies as well as the liability of the owners in relation to third parties. On this basis, we can offer you the following legal company structures:
Limited liability company (LLC) Joint-stock company (JSC) Limited partnership (LP) Limited liability partnership (LLP) Foundation General partnership (GP) Branch office Representative office Trust Confidus Solutions can provide you with in-depth legal consultation regarding business and tax planning strategies, as well as advising on a suitable legal structure for your company. As each type of entity has its own benefits and disadvantages, we strongly recommend that you contact us before proceeding with the company formation procedure.
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15.01.2024 12:21