Slides of the Webinar "International Tax Planning for Trading Companies" presented by NEWCO. In this webinar, the concept of trading is explained, as well as the key factors normally considered when choosing a jurisdiction, namely safety and credibility, transparency, human resources and know how, operational costs, infrastructures and tax regime. The specific advantages of Madeira and Malta for international trading companies are also outlined.

1. NEWCO © All rights reserved 2014
International tax
planning
for trading companies
We know how

2. Topics
1. Concept of trading
2. Key factors
Credibility and security
Transparency
Human resources and know-how
Operational costs and infrastructures
Tax regime
3. Trading in Madeira
4. Trading in Malta
5. NEWCO
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3. 1. Concept of Trading
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4. 4
Concept of international trading
• Purchase and sale of goods or provision of services involving more than one country:
ü Import and export operations or operations within the EU
ü Triangular operations or those involving stock management
ü With or without manufacturing
ü Provision of services at the international level
• Operations with related entities vs operations with third parties
• Broad concept of trading: passive income vs active income
Concept of trading

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2. Key factors

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Key factors | Credibility and security
• Efficient and pro-business legal system
• Social and political stability
• Security
• Freedom of establishment and capital control policies
• Sector specific licencing and regulations
• Labour law
• European directives and compliance with EU law
• Consistency in the legislation and granted benefits
• Possibility of obtaining rulings
Key factors

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Key factors | Transparency
• Black lists
• Compliance with OECD criteria on transparency and exchange of information
Key factors

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Key factors | Human resources and know how
• Availability of qualified human resources
• Languages
• University and R&D resources
• International business environment
• Capability and capacity to import know-how
• Experienced and efficient professional services providers
• Soundness, sophistication and efficiency of the financial system
• Culture
Key factors

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Key factors | Operational costs and infrastructures
• Cost of wages and other labour costs
• Cost of supplies and external services
• Cost of living (real estate, food, transportation and so on...)
• Road network
• Telecommunications
• Air and maritime transportation
• Currency and exchange costs
• Fiscal costs
Key factors

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Key factors | Tax regime
• Corporate income tax
• VAT and other indirect taxes
• Withholding taxes
• Double taxation agreements
• Personal taxation
• Social security
• Taxation of expatriates
• Exit taxes
Key factors

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Key factors | Tax regime
• Efficiency and attitude of tax administration
• Anti-abuse rules
ü Tax havens
ü Transfer prices
ü GAAR
ü Other
Key factors

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3. Trading in Madeira

13. Trading in Madeira
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14. 14
Trading in Madeira
Trading in Madeira

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Madeira companies benefit from the following tax regime:
• 5% corporate income tax rate (IRC)
• Withholding tax exemption
• Tax credit for international double taxation
• Capital gains tax exemption
• Exemption from local taxes
• Exemption from stamp duty
• Exemption from taxes on real estate (IMT and IMI)
• Exemption from notary and registration fees
Trading in Madeira | Tax regime
Trading in Madeira

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Trading in Madeira | general requirements
• Must be licensed to operate within the scope of the IBC by the regional Government of
Madeira
• Tax exemption for payments to non-residents in Portugal or other entities operating
within the scope of the IBC
• Reduced corporate income tax rate on income obtained with non-residents in Portugal or
with other entities operating within the scope of the IBC
• Exemption from Real Estate Transfer Tax (IMT) and Municipal Property Tax (IMI) only for
property located in Madeira used for the company’s business
Trading in Madeira

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Trading in Madeira| substance requirements
The company must have at least one paid employee or director (full-
time or part-time) on its payroll
If the company employs fewer than 6 employees (or directors),
during the first two years of activity, it must make a minimum
investment of €75 000 in the acquisition of tangible or intangible
fixed assets
NOTE:
- Requirement 1 must be fulfilled within 6 months.
- Requirement 2 must be fulfilled within 2 years.
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1
Trading in Madeira

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Trading in Madeira| ceilings
Trading in Madeira
Tax benefits have limits, depending on the number of employees (or
directors) under the above referred conditions:
If taxable income exceeds the limit, the excess will be taxed at 23% (general
regime in Madeira)

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Double taxation
treaties
Trading in Madeira

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Madeira offers investors many other advantages:
• Advance rulings
• Non-resident company branch offices
• Redomiciliation of companies
• Transfer pricing
• Special regime for the Industrial Free Trade Zone
• Special regime for non-habitual residents
• Golden visa
Trading in Madeira| other advantages
Trading in Madeira

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Trading in Madeira
Trading in Madeira

22. 4. Trading in Malta
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23. Trading in Malta
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24. Trading in Malta
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Trading in Malta

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Trading in Malta | tax regime
Trading in Malta

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Trading in Malta | Effective tax rates
Trading in Malta

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Double taxation
treaties
Trading in Malta

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Malta’s tax regime offers many other advantages:
• Withholding tax exemption on the payment of royalties, interest, dividends
or proceeds of liquidation
• Exemption of Capital Gains tax
• Flexible and straightforward anti-avoidance rules
• Advance rulings
• Possibility to redomicile companies from and to Malta
Trading in Malta| other advantages
Trading in Malta

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Malta’s tax regime offers many other advantages:
• The share capital of the companies can be denominated in any convertible
currency
• Flexibility in the choice of the tax year
• Malta accounting standards based on IFRS
• Stamp duty exemption
• Group tax relief
• Malta has no capital tax or wealth tax
Trading in Malta| other advantages
Trading in Malta

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Trading in Malta
Trading in Malta
|1| Corporate income tax

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32. NEWCO
• Full service corporate service provider in Madeira and Malta
• 23 years of experience
• Strategic values: Know-how, customer satisfaction, integrity, service
excellence and innovation
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33. NEWCO
NEWCO ensures that its clients receive all the necessary support for
effectively establishing their companies in Madeira and Malta, namely with:
• Company incorporation and registration
• Supply of the respective registered office and related services
• companies’ management and administration
• Tax compliance, legal, financial, tax and accounting assistance, consultancy
and assistance in the creation of investment projects
• Services with the purpose to facilitate the setting-up in Madeira and Malta
(offices, equipment, human resources…)
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34. NEWCO
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89%
of
clients
Consider that
NEWCO has a
wide knowledge
of all issues
related to their
jurisdiction
87%
of
clients
Recognize that
NEWCO offers
leading services
in its sector of
activity
93%
of
clients
State that they
are highly likely
to
recommending
our company to
their peers and
partners
“Honest and
Professional.”
Giuseppe Luongo
President
YOUTHSTREAM GROUP
Monaco
“I consider the understanding of customer
needs and willingness to accommodate
and find appropriate solutions the key
differentiator of NEWCO service.”
Luís Franco
Vice-President, SurveyMonkey
Palo Alto, EUA

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Título
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THANK YOU.
Frederico Gouveia e Silva
frederico.silva@newco.pro
skype frederico.silva.newco
M. (+351) 967 819 308
www.newco.pro
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