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EU, EFTA discuss free trade

Published: 02/03/2016 | news

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#EU #Investments

Legislators of the European Free Trade Association (EFTA) met with European Union Trade Сommissioner to discuss priorities in the free trade zone. EFTA Parliamentary Committee met with Commissioner Cecilia Malmstrom on February 23. They discussed a new strategy of Commission, "Trade for all" which aims to make EU trade policy more effective in providing new economic opportunities, as well as more transparent, in terms of opening negotiations to strengthen public control. Rather than focus on the interests of the EU trade policy will uphold EU values. The participants discussed the ongoing negotiations on the partnership of the transatlantic trade and investment partnership. The Committee also met with sever members of the European Parliament including Viviane Reding, the rapporteur on the Provision of trade services agreement. Also, Committee members found out how the European Parliament is involved in the international negotiations of a trade agreement. EFTA countries are Iceland, Liechtenstein, Norway and Switzerland. Author: Olena Kutova senior lawyer of the Finance Business Service company ...

Double tax treaty between Cyprus and Switzerland

Published: 01/03/2016 | news

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#Cyprus #Double taxation #Switzerland

The first Cyprus-Switzerland double tax treaty (DTT), signed in 2014, entered into force in October 2015 with its provisions taking effect as from January 1, 2016. Under the treaty there is no withholding tax (WHT) on interest and royalties. There is also no WHT on dividends in those cases where the beneficial owner of the dividends is: a company (other than a partnership), the capital of which is wholly or partly divided into shares, holding directly at least 10% of the capital of the company paying the dividends for an uninterrupted period of at least one year (the time period criterion may be satisfied post the date of the dividend payment), or a pension fund or similar institution recognized as such for tax purposes, or the government, a political subdivision, local authority, or the central bank of one of the two Contracting States. Per the treaty, a 15% WHT on dividends applies in all other cases. Irrespective of this, per the provisions of Cyprus’ domestic tax legislation, Cyprus does not apply WHT on dividend payments out of Cyprus at all times. Author: Sergey Panovmanaging partner Finance Business...

Held a debate on the future of VAT in the EU

Published: 29/02/2016 | news

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#EU #Reforms #VAT

The European Commission held a debate on reform of the VAT framework on February 24. The Commission was preparing to publicate an Action Plan on VAT. The European Union's value-added tax system "needs reform", said the commission. It needs to close the difference between theoretical VAT revenue receipts and the actual. This was estimated at EUR180bn (USD198bn) in 2013. It was result from avoidance, cheating and providing by the states of the European Union of reduced VAT and tax benefits. The VAT system creates administrative burdens nowadays, noted the European Commission, especially for small businesses and online companies. It said, that the VAT system should to be modernized in today's digital environment because of innovative business models and technological progress. The Commission issued a Roadmap earlier on February. Roadmap of the release of its Action Plan for a simple and efficient system of VAT to the single market that is going to be in March 2016. The Action Plan is intended to summarize the achievements made since the 2011 and set out the direction for future work. The principle of the new rules it is the destination...

Financial Institutions Tax (FIT) in Poland

Published: 29/02/2016 | news

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#Poland

The Polish Parliament adopted the bill introducing a new tax on financial institutions (called also a bank levy). The bill was passed for signature of the President. It entered into force from February 1, 2016. Generally, the tax applies to banks, credit unions, lending institutions, as well as insurance/reinsurance companies. The new tax applies also to Polish branches of foreign banks (credit institutions) and foreign insurance/reinsurance companies. The funds are out of scope. According to the new law, the tax base is defined as the surplus of total assets disclosed in the financial institution’s accounting books exceeding certain amount calculated at the end of each month. In the case of banks and credit unions, as a rule, the tax base will be decreased by the amount of their equity. Author: Sergey Panovmanaging partner Finance Business...

Property tax reform for UK

Published: 29/02/2016 | news

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#Reforms

The International Monetary Fund said, that the United Kingdom should make changes to its medium-term fiscal consolidation strategy. Reducing of tax expenses could improve the tax regime's efficiency, increase tax neutrality and to free up revenues, the IMF has said in its 2015 Article IV report. The report also said that further property tax reform could decrease the shortage of housing. It recommended easing the tax burden on real estate transactions and increase the fees that are based on the property value.Also recommended to reduce tax rebates on the property of a single occupier. The IMF said that the reduction of the bias of tax code toward debt could contribute financial stability. Author: Olena Kutova senior lawyer of the Finance Business Service company ...

Offshore fund

Published: 19/05/2015 | news

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#Funds #Investments

Entrepreneurs with successful experience of investing abroad their own funds are very often interested in investment operations with assets of the third parties. Pooling investors usually allows investing money at much more favorable terms. This is the main reason for the existence of investment funds. Investment fund is a subject of law, which is different from all other entities, known in the common law that it is not legal personification of a person or group (as in the case of a corporation); it is rather a subject that has no owners (shareholders, members or partners) and traditionally has a specific target orientation – profit group of individuals. Activities of the Fund are subject to regulation by the State where the fund is registered. That is why it is advantageous to register such fund in the offshore zones. In these countries, the regulation comes down to ensure that the fund must obtain permission from the authorities on their activities and submit timely reports on the statutory form. The investment activity of the fund itself is practically not regulated, which makes it possible to invest in a wide variety of instruments. Investment funds are...

Offshore trust – structure, provisions

Published: 18/05/2015 | news

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#Business #Tax exemptions #Trusts

A founder (who can be also a beneficiary), under a special agreement passes the valuables to the control of a trustee, who shall perform operations with them, bringing the maximum profit to the beneficiaries or other, relevant to instructions of the founder. Trustee services are paid by the beneficiaries or trust founder, usually as a percentage of the profits. The object of trust can be any property, both movable and immovable. The property expressly prohibited by the legislation of trust’s country of foundation is excluded from this relationship. The founder may transfer his property during his lifetime (lifetime trust), and provide such transfer after his death (testamentary trust). The trustee is responsible for the conditions of the trust agreement and, as a rule, gets wide powers to manage the estate of the founder, but can also get specific instructions on the distribution of trust income and capital between the beneficiaries upon the occurrence of certain conditions, clearly specified by the founder. Such conditions are usually included in the so-called founder’s letter of wishes, addressed to the trustee. The founder also has the right to make...

Offshore jurisdictions confirmed by CMU – list

Published: 23/06/2014 | news

To understand what represents the concept of the offshore jurisdiction, we offer at first deal with what exactly is an offshore. Offshore - is a company which is registered in the country, which has a preferential tax treatment or it is replaced by a fixed duty, which is a particular type of ownership and limited to the conduct of business in the territory of the country of registration. Offshore enables the company to continue to carry out foreign trade activities, paying only a fixed annual fee at the place of registration. Offshore jurisdiction (from eng. «off shore» - offshore, outside) - is a territory of a certain state or a part thereof, within which foreign companies are operating a special preferential regime of business registration and taxation. Such a company usually conducts its business activities outside that country. In some countries, as such terms are used to refer to tax havens as a "tax shelter" or "tax haven" (from eng. «tax haven».), as well as "tax paradise". The essence of the offshore jurisdictions and their classification The offshore areas are in themselves a subsystem service zones in special economic zones. Typical offshore...

Dividends paid to non-residents of Ukraine

Published: 09/10/2013 | news

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#Dividends #Taxation #Ukraine

In this article, we propose to consider the main issues related to the payment of dividends to non-residents of Ukraine, that is, the individuals / juridical persons who are representatives of other states. First of all, it should be noted that Ukrainian law provides the right of foreign investors to ensure they receive all the profits obtained in our country legally. This immediately indicates that the resident of Ukraine, being the actual issuer of corporate rights, who carries out the payment of dividends to non-residents, is subject to the general legislation on taxation. That means that regardless of the fact to whom the payment of dividends is made, the issuer is obliged to pay an advance fee of 25% without reducing the amount of dividends. International agreements related to the elimination or reduction of double taxation of income does not apply to this payment. Now let's discuss in more details the payment of dividends to legal entities which are non-residents of Ukraine. First of all, we emphasize that when paying dividends to non-resident, who is in fact a legal entity, but has no such status, the issuer of corporate rights is obliged to withdraw...

Optimization of tax payments: schemes, methods, rules

Published: 06/09/2011 | news

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#Offshore schemes #Taxation

The history of taxation has a long old root, as an existing of any country. As long, the country will exist, as long the citizen will pay taxes. The owners of small and big business see a direct threat in taxes for them capital. The state has it's own interest in this question as a sole proprietorships. As we see, it's not so easy to create a fair system of taxation. In such way in tax culture, more often is used term "tax planning". The main aim of tax planning is to get financial result when taxation payments will be minimized. The development of tax planning in a right way take great part, because it give an opportunity to use niceties of tax legislation in a whole size. Because of this lost during tax payment minimized. The main directions of external tax planning: replacement of the subject of taxes, that is, changing the company form to one that will be more suitable for the implementation of this regime; new activities (meaning a form of activity, which will be subject to a more simplified) replacement tax jurisdiction (registration of the company in the region, where preferential tax treatment) The internal planning is carried out by optimizing...

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