INTERNATIONAL TAX PLANNING IDEAS

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• INTERNATIONAL TAX PLANNING IDEAS
• ???? ?? ?????????????? ?????????? ????????????

2
CYPRUS COMPANIES COMBINED WITH OTHER
COMPANIES ARE THE MOST EFFECTIVE VEHICLES FOR
INTERNATIONAL TAX PLANNING???????? ???????? ?
?????????? ? ??????? ?????????? ???????? ????????
???????????? ??????????? ? ?????????????
????????? ????????????

• CYPRUS IS NOT AN OFFSHORE JURISDICTION BUT A
  RESPECTABLE TAX REGIME ACCEPTABLE BY EU AND OECD
• WITH THE LOWEST TAX RATE IN EU STRONG ECONOMY
  THAT ENABLES IT TO MAINTAIN IT
• AND A DOUBLE TAX TREATY WITH 40 COUNTRIES
  OFFERING MANY OPPORTUNITIES FOR EFFECTIVE TAX
  PLANNING-IDEAL HOLDING CO
• IF WE INVEST IN COUNTRY WHICH DOES NOT HAVE A
  DOUBLE TAX TREATY WITH CYPRUS WE CAN USE OTHER
  COUNTRIES IN THE MIDDLE LIKE NETHERLANDS OR
  LUXEMBOURG OR SWISS OR UK

• ???? ?? ???????? ???????? ???????????, ?? ?????
  ??????????????? ????????? ?????, ?????????? ? ??
  ? ????
• ????? ?????? ????????? ?????? ? ?? ? ???????
  ?????????, ??????? ????????? ???????????? ??
• ?????????? ? ??????? ??????????????? ? 40
  ????????, ???????????? ??????? ??????????
  ???????????? ??? ???????????? ??????????
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• ???? ?? ??????????? ? ??????, ??????? ?? ?????
  ?????????? ? ??????? ??????????????? ? ??????, ??
  ????? ???????????? ?????? ?????? ? ????????
  ?????????? (?.?. ??????????, ??????????,
  ????????? ??? ?????????????? )

3
CORPORATE TAX RATES DOUBLE TAX TREATY
WITH UKRAINE ?????? ????????????? ??????? ?
?????????? ? ??????? ??????????????? ? ????????

• WITHHOLDING TAX ON
• DIVIDENDS 0
• INTEREST 0
• ROYALTIES 0

• ???????????? ????? ??
• ????????? 0
• ???????? 0
• ???????????? ????? 0

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AS A TRADING COMPANY???????? ????????
EXPORT COMPANY ????????-?????????
IMPORT COMPANY ????????-????????

• PROFIT IS TRANSFERRED TO CYPRUS AND TAXED AT 10
• ??????? ??????????? ?? ???? ? ?????????? 10
  ???????
• AVOID VAT RETENTION AND CASH FLOW PROBLEMS WHEN
  TRADING AMONG EU COUNTRIES
• ????????? ????????? ??? ? ??????? ? ????????
  ??????? ? ???????? ???????????? ???????? ?????
  ???????? ??
• SUBSTANCE IS IMPORTANT
• ???????? ???????? ????? ????????

CYPRUS TRADING COMPANY ???????? ???????? ????????
OFFSHORE COMPANY ???????? ????????
5
AS INVESTOR IN ESTATE CO???????? ? ????????,
??????? ? ????? ????????????
PROPERTY OWNED BY ESTATE CO ABROAD IS SOLD BY
SELLING THE SHARES OF THE CYPRUS CO WHICH IS THE
SOLE SHAREHOLDER OF THE ESTATE CO 0 TAX ON
PROFIT FROM SALE OF SHARES
???? ?????????? ????????, ??????? ????????
?????????? ????????????, ??????? ????? ????????
????????, ??????? ???????? ????????????
?????????? ????????, ????????? ?????????????,
?????? ?? ??????? ?? ??????? ????? ?? ??????????
OFFSHORE COMPANY ???????? ????????
HOLDING CYPRUS CO ???????? ???????
ESTATE CO ABROAD ?????????? ????????
6
AS AN INVESTMENT COMPANY TRADING IN
SECURITIES?????????????? ????????, ?????????
??????? ????????

• PROFIT IS TAX EXEMPT
• USE OF DOUBLE TAX TREATIES
• NO WITHHOLDING TAX ON DIVIDENDS OUT OF CYPRUS

CYPRUS CO TRADING IN SECURITIES ????????
????????, ????????? ??????? ????????

• ??????? ?? ?????????? ???????
• ????????????? ?????????? ? ???????
  ???????????????
• ??? ????????????? ?????? ?? ????????? ? ?????
  ?????????

SELL SECURITIES ??????? ?????? ?????
BUY SECURITIES ??????? ?????? ?????
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AS A HOLDING COMPANY??????????? ????????

• ??? ????????????? ?????? ?? ?????????, ???????
  ??????????? ???????? ?? ????????
• ???????????? ????? ???????? ???????? 0
• 0 ????? ?? ????????? ?? ?????
• ??? ????????????? ?????? ?? ?????????, ???????
  ????????????? ???????? ????????? ????????????

• NO WITH HOLDING TAX FROM DIVIDEND PAID FROM EU
  SUBSIDIARIES
• ZERO WITHHOLDING TAX FROM TREATY SUBSIDIARY
• 0 TAX IN CYPRUS ON DIVIDEND
• NO WITHHOLDING TAX ON DIVIDEND PAID TO NON
  RESIDENT BY CYPRUS CO

ULTIMATE HOLDING CO ???????? ???????????
????????
CYPRUS HOLDING CO ???????? ??????????? ????????
UKRAINIAN SUBSIDIARY ???????? ???????? ? ???????
EU SUBSIDIARY ???????? ???????? ??
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AS A FINANCE COMPANY?????????? ????????

• PROFITS REDUCED IN OPERATING COUNTRY DUE TO THE
  INTEREST PAID TO CY CO
• SMALL MARGIN TAXABLE AT 10 IN CYPRUS
• NO WITHHOLDING TAX

OFFSHORE COMPANY ???????? ????????

• ??????? ????????? ? ??????-????????????? ? ?????
  ? ??????????, ??????? ????????????? ????????
  ????????
• ?? ????? ?????? ?????? 10
• ??? ????????????? ??????

CYPRUS FINANCING CO ???????? ?????????? ????????
OPERATING CO ???????????? ????????
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CYPRUS CO AS A ROYALTY COMPANY???????? ????????
? ???????? ?????? ????????

• Plan
• Parent co establishes Cyprus royalty co to
  collect royalties from Ukrainian
• Benefits
• Tax on profit 10 in Cyprus on the net amount of
  the royalty income
• Royalty is deducted from taxable profit in paying
  company
• No WHT on royalty from Cyprus to the parent co or
  another franchisor
• No WHT for royalty paid by Ukrainian company
  based on the DTT

Parent Co or Franchisor ??????????? ????????
??? ??????????
0 WHT

• ???? ??????????? ???????? ????????? ????????
  ???????? ??? ????????? ???????????? ????? ?
  ???????
• ????????????
• ?? ????? ????? ?? ??????? ?? ???????? 10 ??
  ?????? ???????
• ???????????? ??????? ?????????? ??
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• ??? ?????? ?? ???????????? ????? ?? ????? ???
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• ??? ?????? ?? ???????????? ?????, ???????
  ?????????? ?????????? ???????? ???????? ????????
  ?? ????????? ???????? ???????????????

Cyprus royalty Co ???????? ?????? ????????
10
0 WHT
Ukrainian operation co ???????????? ???????? ?
???????
10
UNITED KINGDOM COMPANIES- Cyprus tax
residents???????? ?????????????? ?????????
????????? ?????

• Most of our clients use UK Companies as non-UK
  residents because of the high tax rate in UK and
  elect to be Cyprus tax residents
• Management and control is in Cyprus
• As Cyprus tax resident, tax is paid in Cyprus and
  can enjoy all benefits of the extensive double
  tax treaties network of Cyprus but not of UK
  double tax treaties
• VAT registration in Cyprus has the same benefits
  as in UK

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ADVANTAGES VS DISADVANTAGES OF UK CO. RESIDENT IN
CYPRUS???????????? ? ?????????? ???????????
???????? ?????????????? ?? ?????

• ????????????
• ?????? ????????? ?????? (????? ?????? ? ??????)
• ??????????? ????????? ? ??????? ??????????? ???
• ?????? ?????????? ?????????? ?? ????? ?????
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• ????? ?????????????? ????? ??????????????
• ????????????? ???????? ?? ????????? ????????
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• ??????????
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  ??????????????

• ADVANTAGES
• Taxed at a lower tax rate (the lowest in Europe)
• Easier VAT registration procedure and
  requirements
• Tax Authorities in Cyprus much less strict
• Lower tax penalties
• UK image can be used
• Double Tax Treaty between Cyprus and Ukraine
  apply
• DISADVANTAGES
• Cyprus network of DTT less extensive than UK
• UK tax residence certificate cannot be obtained

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Agency structure????????? ????????
Offshore Principal ????????? ???????? ????????
Principal-Agent Agreement ??????? ?????
??????????? ? ???????
UK Company ???????? ??????????????
Purchase ???????
Sale ???????
Goods ?????
EU Company ???????? ??
Ukrainian Company ?????????? ????????
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LEGAL ASPECTS OF A CYPRUS INTERNATIONAL BUSINESS
COMPANY??????????? ??????? ????????????? ??????
???????? ?? ?????

• LIMITED COMPANIES
• PARTNERSHIPS
• BRANCHES
• COMPANY INFORMATION FILED AT THE REGISTRAR
• EASY REGISTRATION PROCEDURE
• TO SERVE OUR CLIENTS BETTER AND QUICKER WE HAVE
  READY MADE OFF THE SHELF COMPANIES

• ???????? ? ???????????? ????????????????
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• ??? ???????? ???????????? ?? ?????????? ???????
  ?????????????????? ????????

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REGISTRATION REQUIREMENTS?????????? ???
???????????

• ?????????? ????????
• ???????? ??????? ??????? 100 ????
• ????????? ??? ??????? ???? ?????????? ???? ???
  ???????? ?????? ??????????? ??????????
• ??? ??????? ???? ??????? ??? ?????????? ??????
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• ?????????????????? ???? ?? ?????
• ????? ?????????? ??????????

• APPROVAL OF NAME
• SHARE CAPITAL MIN
• 100
• SHAREHOLDER AT LEAST ONE INDIVIDUAL OR
  COMPANY-NOMINEE SHAREHOLDER SERVICE
• DIRECTOR AT LEAST ONE CYPRIOT OR ALIEN- NOMINEE
  DIRECTOR SERVICE
• SECRETARY INDIVIDUAL OR COMPANY
• REGISTERED OFFICE IN CYPRUS
• AUDITED FINANCIAL STATEMENTS

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SHAREHOLDING?????????

• BENEFICIAL SHAREHOLDERS CAN EITHER HAVE THE
  SHARES REGISTERED IN THEIR NAME AT THE REGISTRAR
  OF COMPANIES
• OR CAN USE NOMINEE SERVICES I.E THE SHARES WILL
  BE HELD BY OUR NOMINEE COMPANIES IN TRUST FOR
  BENEFICIAL OWNERS TO ENSURE CONFIDENTIALITY

• ??????????? ????? ??????? ???????,
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  ????????
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  ????? ?????????? ??????????????????

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PROTECTION IN CASE OF NOMINEE SHAREHOLDERS??????
? ???? ??????????? ??????????

• REPUTABLE NOMINEES
• DECLARATION OF TRUST IS ISSUED BY THE NOMINEES
• SIGNED INSTRUMENT OF SHARE TRANFER IS GIVEN BY
  THE NOMINEE TO THE BENEFICIAL OWNER
• CONFIDENTIALITY IS SAFEGUARDED AS
• COPY OF THE PASSPORT IS HELD WITH US AND THE BANK
  ONLY
• THE BANK DOES NOT DISCLOSE THE INFORMATION UNLESS
  IN CRIMINAL CASE

• ????????????? ??????? ??????????? ????
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SUMMARY OF CYPRUS COMPANIES BENEFITS ??????
??????????? ???????? ????????

• LOWEST CORPORATE TAX RATE IN EUROPE 10
• LOWEST VAT STANDARD RATE IN EUROPE 15
• EASY VAT TAX REGISTRATION PROCEDURES
• EASY AND FAST OBTAINANCE OF TAX CERTIFICATES
• THE BEST DTT WITH UKRAINE
• LOW INCORPORATION MAINTENACE COSTS
• TRANSACTIONS WITH OFFSHORE JURISDICTIONS ARE
  FULLY ACCEPTED
• SAME DAY OPENING OF BANK ACCOUNT
• HIGHLY EFFICIENT BANKING OPERATIONS
• PROFESSIONAL SERVICES OF HIGH STANDARDS

• ????? ?????? ????????????? ????? ? ?????? 10
• ????? ?????? ??????????? ?????? ??? ? ??????
  15
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CONTACT US

• GLOBALSERVE CONSULTANTS LTD
• 9 VASSILI MICHAELIDES
• 3026, LIMASSOL-CYPRUS
• P.O BOX 57048, 3311, LIMASSOL, CYPRUS
• TEL. [phone]
• FAX. [phone]
• WEB SITE www.globalserve.com.cy
• EMAIL info_at_globalserve.com.cy
• CONTACT PERSONS
• DINOS ANTONIOU, C.E.O
• PHANI SCHIZA ANTONIOU, MANAGING
• DIRECTOR

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THANK YOU ???????