Especially Cyprus, where the tax system allows for a series of clever tax solutions. On Cyprus, Withholding Tax is not deduced from the royalties paid by Cypriot entities to foreign licensors. No tax is also deduced from dividends, as it was suspended. It’s also became popular to set up companies there for holding solutions and making use of the privileges stemming from deals made by Cyprus about avoiding double taxation. The CIT rate for companies is 12.5%. A dividend paid to non-residents is exempt from income tax. However, 10% can be deducted from tax in Poland. (mutual deal with the government in Cyprus). Despite changes made to some legal regulations in recent years, Cyprus is still an excellent choice for setting up headquarters for holdings that own other companies in EU member states.
Setting up a company in Malta allows for an effective tax optimisation. It’s worth mentioning that the very low, but effective business taxation (at a rate of 5%) and the lack of tax deducted from dividends and capital gains makes Malta a very interesting destination for conducting business. In addition, setting up a company there allows to maintain long-term anonymity, as shareholders’ addresses are not disclosed in publicly available registers. Malta’s member status in the EU and the current deal between Malta and Poland about avoiding double taxation is of considerable importance and allows for maintaining a business without incurring high operating costs. Malta’s strategic position in the Mediterranean basin is also notable, as it allows for efficient trade with not only southern European countries, but also those in the north of Africa.
Because we collaborate closely with partners in these countries, we are able to choose the best solutions for our clients.
