Category: General

Background

Nevis is a leading international Caribbean financial centre with a good reputation and excellent standards.

The jurisdiction of St Kitts & Nevis offers options in terms of international companies, private trustee companies and international trusts and foundations. It also offers an attractive passport scheme (recipients do not need to reside in St Kitts & Nevis), which is of particular appeal for individuals requiring an additional passport to ease travel and/or perhaps whilst they are awaiting receipt of a passport from another jurisdiction.

A brief summary of the key advantages available is detailed below. For further information please contact the Dixcart office in Nevis: advice.nevis@dixcart.com.

Nevis as an International Business Centre

• Nevis does not levy VAT or other indirect taxes in relation to Nevis International Business Corporations (IBCs) and there is NO income tax, NO corporation tax, NO capital gains tax, NO wealth tax, and NO death duty or  inheritance tax.

• The Nevis Financial Registry maintains the strictest levels of confidentiality.

• Legislative and fiscal independence mean that the island responds quickly to the needs of business.

• Nevis is a well-regulated jurisdiction and is recognised by the FATF (Financial Action Task Force) and the OECD (Organisation for Economic Co-operation and Development).

• New legislation is regularly being introduced, offering an increased number of corporate vehicles. These include IBCs; insurance, companies, LLCs (Limited Liability Corporations), multiform foundations, registered trusts and mutual funds.

• The island is independent and offers a stable political and economic environment.

• Nevis is a former British Colony which applies a common law legal system (similar to the English legal system).

Dixcart, in Nevis, offers bespoke structures, allowing families to set up specific solutions that maintain the confidentiality of the family.

The Dixcart office in Nevis establishes and manages companies and can also assist with the re-domicile of non-Nevis companies to Nevis for the purpose of either continuance or closure.

Dixcart also has the ability to manage companies from other Caribbean jurisdictions and to provide the necessary levels of management and substance that are now commonly required by countries within the EU and other countries around the world.

Nevis Structures, the Economic Citizenship Programme and their Key Benefits:

• IBC – International Business Corporation 
  • Sole directors allowed (both personal and corporate).
  • Incorporated in 24 to 48 hours.
  • Easy to setup and maintain, private and cost effective.
  • Ability to have documents legalised in the UAE, due to the St Kitts Consulate in Dubai.
  • Certificates of Good Standing/Incumbency can be notarised and apostilled in under 24 hours.

• LLC – Limited Liability Company
  • A legal entity with separate rights and liabilities, distinct from its managers and members, which is liable for its own debts, obligations and liabilities.
  • Can be used for any legal purpose, including financing US and non-US operations, real estate holding, manufacturing and investment vehicles for international trusts.
  • Incorporated in 24 to 48 hours.
  • Foreign LLCs may convert to become a Nevis LLC through use of a simple conversion plan.
  • Foreign entities may convert to become a Nevis LLC after redomiciling to Nevis.
  • Extra protection can be gained by stating that ‘the explicit naming of a member or manager in a legal action being brought against the company is legal grounds for dismissal or at least for a motion of misjoinder’.

• PTC – Private Trustee Company
  • No licence required to act as trustee (for private family arrangements).
  • Incorporated in 24 to 48 hours with sole directors allowed (both personal and corporate).
  • Can be owned either by a purpose trust or by the settlor.
  • Ability to have a representative of the underlying asset companies on the Board of the PTC and it is relatively easy to replace the Board and therefore the effective trustees, if necessary.

• International Trust
  • Registered in 24 to 48 hours.
  • Cannot be declared void, voidable or defective by reason of any forced heirship rules of the Settlor’s domicile, residence, place of current incorporation, formation or establishment.
  • No rule against perpetuity unless otherwise provided for; the international trust can therefore have unlimited duration.
  • Foreign judgements are not enforceable in Nevis.  Any civil action to recover assets would need to be brought, in addition, in the Courts of St Kitts & Nevis.
  • A deposit of $100,000 must be paid before creditor action can be taken.
  • If the Protector has the authority to direct the Trustees to make and approve distributions, or to direct the Trustees to make particular investments, statutory protection is given to the Trustees for acting on the direction of the Protector, in the absence of wilful misconduct.

• Multiform Foundations
  • Asset protection and succession planning opportunities.
  • Can be set up for estate planning, charity, financing and special investment holding arrangements.
  • Can take the form of a foundation, a company, a trust or a partnership.
  • The ordinance allows for entities to be converted or transformed, continued or consolidated and merged into Nevis Multiform Foundations.

• Economic Citizenship Programme – Passports

A St Kitts & Nevis passport can provide a relatively fast option to ease  travel and to gain residence, if required, whilst plans are being made to live elsewhere.

There are three alternative routes to gain a St Kitts & Nevis passport:

• Investment in Real Estate.
• Investment in Luxury Real Estate.
• Sustainable Growth Fund (SGF) Contribution.

Applicants do not need to visit St Kitts & Nevis in order to apply for a St Kitts & Nevis passport. They do, however, need to use an approved intermediary on the island, such as Dixcart, to coordinate the application.

There are NO conditions attached to a St Kitts & Nevis passport in terms of the number of days that need to be spent on St Kitts & Nevis. Other advantages include:

• Visa-free access to over 130 countries around the world including Europe, UK, Hong Kong, Russia, Ukraine, and Switzerland.
• Fast processing times; approval can be achieved in between 45 to 60 days using the ‘accelerated process’ and 90 to 120 days with standard processing.
• Inclusion of dependant children up to the age of 30.
• Inclusion of dependant parents from the age of 55.
• Sponsorship of common law partners.
• Ability to pass citizenship to children.

Additional Information

Nevis offers a number of attractive international entities and an appealing Economic Citizenship Programme. If you require additional information, please contact John Mellor at our office in Nevis advice.nevis@dixcart.com or your usual Dixcart contact.

The beautiful Isle of Man is situated in the heart of the Irish Sea, centrally located between England, Ireland, Scotland and Wales.  Whilst the island may be small, just 572 km², with its rugged coastline and rolling hills it can give you and your family space to breath, relax and enjoy what island life has to offer.

The Isle of Man has been a self-governing Crown Dependency since 1866, and this political independence, combined with its strong democratic values, has enabled the Isle of Man to be governed efficiently over the past 150 years.

Advantages Offered by the Isle of Man

The Isle of Man Government has always adopted a forward thinking and pragmatic domestic and international approach, which allows the close knit community of approximately 87,000 people to benefit from the following advantages:

• Lifestyle

The natural resources of the island enable residents to pursue a variety of recreational and sporting activities. The growth of the sporting community on the island has been supported by the Isle of Man Sports Council www.isleofmansport.com  and the Manx National Lottery Fund.

• Crime (or lack of it)

The Isle of Man has one of the lowest crime rates in the EU. This is further enhanced by a strong community spirit.

• Low Unemployment

The Isle of Man currently (April 2016) has an unemployment rate of 1.8%.  Whilst there is a requirement for non local residents to hold a work permit for the first 5 years of residency, the work permit process is, in most instances, a relatively straightforward process. www.gov.im/categories/working-in-the-isle-of-man/work-permits/faqs

• Housing

The Isle of Man is consistently rated as having a standard of living equal to those regions with the highest standard of living in the UK. There are no restrictions on buying property for those not born or raised on the island.

• Education

The Isle of Man has a high quality of education. Recently the Government invested in a programme to modernise all of the schools, and the island achieves one of the top sets of comprehensive school results in the UK, with private schools also positioned well in the UK rankings.

• Transport

The island has excellent transport links. The large international carriers, including British Airways, easyJet, and Flybe offer routes from the Isle of Man to Dublin, Edinburgh, Geneva, Liverpool, London and Manchester. In addition, the island has the runway capacity to handle large private aircraft, including the Global Challenger 7000.

• Tax Advantages for Individuals

The standard rate of income tax in the Isle of Man is 10%, with a higher rate of 20%. A tax cap of £150,000 (£300,000 for jointly assessed couples) exists on personal income tax liabilities in any one tax year for individuals living in the Isle of Man. To be tax resident in the Isle of Man the Assessor of Taxes must be satisfied that there is an intention to establish residence on the island, rather than there being a presence on the island for a temporary purpose.

• The Key Employee Concession (KEC)

The KEC can be extremely beneficial to new arrivals on the Island and may even be more beneficial than the tax cap, in certain circumstances. It applies to individuals who are required to move to the Isle of Man by their employer and who are essential to the implementation and operation of new business on the Island. In order to grant the KEC, the Treasury must be satisfied that the new business is in the economic interests of the Isle of Man and will provide additional productive employment on the Island.

When the Concession applies the individual will be resident for Isle of Man income tax purposes and therefore subject to resident income tax rates, allowances and reliefs. However the majority of additional income sources will be treated, for Isle of Man tax purposes, as if the individual was not resident on the island.

This could be extremely beneficial if, for example, a wealthy entrepreneur who has substantial income streams from non-Manx sources moves to the Island and sets up a business on the Island. Of course, for the KEC to apply to them, they would have to be employed by that business on the Island.

• Tax Advantages for Companies

A zero rate of corporation tax applies to company profit.

The only exceptions to this zero rate are banking business, which is taxed at 10%, retail businesses with profits in excess of £500,000, which are also taxed at 10%, and income from land and property in the Isle of Man, which is taxed at 20%.

There is a requirement to prepare annual accounts, however, for private companies there is no requirement to file these. There is also a requirement to complete an annual tax return.

• Government Support for Inward Investment

The Department of Economic Development has solid experience in assisting businesses to relocate to the Isle of Man. A Relocation Manager can be appointed to act as a single point of contact for all relocation matters relating to the Isle of Man. In addition, the island’s Financial Assistance Scheme provides a range of grants to eligible businesses within qualifying sectors.

• Immigration

UK Immigration Rules are extended to the Isle of Man for regulating the entry into, and the stay of persons in the Isle of Man. Whilst the Isle of Man has its own Immigration Rules (based on UK immigration rules), the United Kingdom represents the Isle of Man’s interest in Diplomatic and Foreign Affairs. British Embassies overseas accept and process visa applications for the Isle of Man and other Crown Dependencies (CDs), referring the applications to the islands’ Entry Clearance Officers to determine a decision.

Additional Information

If you would like further information regarding the advantages offered by the Isle of Man and how you might take up residence there, speak to David Walsh at the Dixcart office in the Isle of Man or to your usual Dixcart contact.

Dixcart Management (IOM) Limited is licensed by the Isle of Man Financial Services Authority

Switzerland is a very attractive location to live and work in for many non-Swiss nationals.

Switzerland is a beautiful country with amazing scenery as well as a number of world-famous cities such as Bern,
Geneva, Lausanne, and Zurich. It also offers an attractive tax regime for individuals as well as for companies, in the
right circumstances.

Here is a summary of the benefits Switzerland has to offer businesses and individuals and why it is a popular
jurisdiction for asset protection, residence and company establishment.

What does Switzerland Offer Businesses, Individuals and Families?

• Located in the centre of Europe
• Economic and political stability
• A well-respected jurisdiction with an excellent reputation
• Most ‘innovative’ country in the world for nine consecutive years
• Lengthy history of expertise in finance and business
• Premier destination for international investment and asset protection
• High regard for personal privacy and confidentiality
• Very good living and working conditions
• International hub for HNWIs and international families

Who does Switzerland Appeal to, Internationally?

• International Headquarter Companies for Groups
• Substantial Trading Companies
• Large domestic and overseas Banks with expertise in open international capital markets
• Trusts and Private Trust Companies
• Family Offices
• Individuals seeking to redomicile within central Europe

Double Taxation Agreements (DTAs)

• Switzerland has over 100 DTAs
• Swiss companies benefit from the EU ParentSubsidiary Directive, a tax exemption for cross-border dividends paid between related companies in the EU (Switzerland is not in the EU, but is in the ‘Schengen area’)

Use of a Swiss Company as Trustee

• A Swiss company can act as Trustee or take another role in your family Trust to manage and administer your Trust in Switzerland
• Trusts are not subject to taxation in Switzerland
• The Settlor and Beneficiaries are not subject to taxation, as long as they are not resident in Switzerland
• The Dixcart office in Switzerland has been providing Swiss Trustee services for many years, is a member of the Swiss Association of Trust Companies (SATC), registered with the Association Romande des Intermediaires Financiers (ARIF) and regulated by The Swiss Financial Market Supervisory Authority (FINMA)

Moving to Switzerland

• Working: a work permit enables any individual to become Swiss resident (must have a job or form a company and be employed by it)
• Not working: straightforward for EU citizens. Non-EU citizens must be over the age of 55

Lump Sum System of Taxation

• Applicable on moving to Switzerland for the first time, or returning after a minimum ten year absence (no gainful employment in Switzerland, but can be employed in another country and can administer private assets in Switzerland)
• This particular taxation system is based on the taxpayer’s living expenses in Switzerland, NOT on worldwide income and assets
• The amount of living expenses on which income tax is based, varies from canton to canton, and is usually negotiated with the relevant tax authorities (in Geneva, a minimum taxable income of CHF400,000 is required)

The Dixcart Office in Switzerland

If you require any further information orn moving to Switzerland or the establishment of a Swiss company for asset protection, please contact Christine Bretiler in our Swiss office: advice.switzerland@dixcart.com

Background

A new legislative initiative in Malta means that it is now possible to grow and process cannabis (marijuana) in Malta, as long as it is for medical use. This presents an opportunity for entrepreneurs and investors.

Due to its geographical position Malta is also conveniently placed, as a potential distribution hub for medical cannabis.

Entities need to apply to produce and/or process medicinal cannabis in Malta and must comply with the legal criteria as specified in ‘The Production of Cannabis for Medicinal Use Act 2019’.

The Law in Malta

No cultivation, importation or processing of cannabis, no production of any products intended for medicinal use and no trade in cannabis can be conducted in Malta, prior to obtaining the necessary approvals, authorisations, licences and, or permits as required by or under the applicable Maltese laws.

What Requirements Must the Entity Meet?

The applicant must prepare the following documentation and submit the items to Malta Enterprise (ME):

• A Business Plan – in the form of an Income Statement, Balance Sheet and a Cash Flow for the first three years of operation, with appropriate supporting documentation and appendices;
• Due Diligence – details to include the shareholding structure and information regarding the beneficial owner. The shareholding structure cannot be changed in the future, without prior approval by ME;
• The experience of the shareholders must be detailed and this is regarded as of particular importance.

The applicant must then obtain a ‘Letter of Intent’ from Malta Enterprise (ME) and ensure full compliance with the provisions of the Production of Cannabis for Medicinal Use Act, and any international obligations, resulting from a treaty that Malta may from time to time be party to.

Following Receipt of the ‘Letter of Intent’

When the project is approved, ME will issue the ‘Letter of Intent’ and the organisation can start to liaise with the Malta Medicines Authority to obtain the relevant licence.

ME may allocate land to the organisation, in one of Malta’s Industrial Parks, if required.

Moving forward, the relevant organisations producing or processing the cannabis, must at all time fully comply with the regulations relating to the production of medical products, as specified in the Malta Medicines Act.

The manufacturing process in Malta, must generate the final product that can then be sold directly to pharmacies.

The export of any goods, which require further manufacture, is not permitted.

Relevant Research and Development should generally also take place in Malta.

Additional Information

Dixcart can provide advice to companies seeking to produce and/or process medicinal cannabis in Malta and can supply additional information regarding related corporate and residence issues.

For further information please contact the Dixcart office in Malta:  advice.malta@dixcart.com or speak to your usual Dixcart contact.

Background

The Maltese Government is committed to promoting the film production sector and cash rebates can be claimed, as a financial incentive, to the growing Audio-visual Industry in Malta.

What Rebates are Available?

• Starting from January 2019, qualifying companies can receive a maximum 40% cash rebate for film production in Malta.

The cash rebates are rebates on the expenses in Malta, and are available at three different levels: 30%, 35% and 40%.

The level of rebate is dependent on the cultural test which includes consideration of such factors as how much of the production is filmed outside in Malta and how recognisable Malta is as the location.

Eligibility Criteria

To be eligible for this scheme the following criteria must be met:

• The production must be carried out by a ‘Qualifying Company’, responsible for all of the activities involved in making a ‘Qualifying Production’ and having access to full financial information in relation to the total production worldwide. There can only be one Qualifying Company with respect to each Qualifying Production.

• A Qualifying Production means an audio-visual work that must be partially or wholly carried out in Malta and processed to commercial release standards, for international distribution for cinema and international telecast (including VOD/SVOD platforms) and is categorised as follows:

1. Feature film;
2. Television production (including a film, a series or mini-series including pilots);
3. Creative documentary;
4. Reality programmes (scripted/unscripted);
5. Game shows.

• The minimum spend in Malta must be €100,000 and the total budget must exceed €200,000.

• The Qualifying Company must take a cultural test. This is to ensure that the audio-visual work is considered to be a cultural product and that it makes a valid contribution in terms of creative expression and culture through the development of production capability skills in the audio-visual sector in Malta.

• Companies need to use a registered Production Service Company for coordination of the production.

Additional Tax Benefits

Qualifying companies can also qualify for tax credits.

This is in addition to the Maltese corporate tax imputation system which, for non-Maltese resident shareholders, results in an effective Maltese tax rate of 5% on active profit, used to pay dividends, and 10% on passive income.

This makes Malta a very attractive destination for the audio-visual industry.

Additional Information

Dixcart can assist with advice on this matter and other related corporate and residency issues in Malta For further assistance please contact us on advice.malta@dixcart.com or speak to your usual Dixcart contact.

A ILHA DE MAN – VANTAGENS PARA INDÍVIDUOS E SOCIEDADES COMERCIAIS

Considerações

A Ilha de Man oferece um conjunto de infra-estruturas altamente atraentes para sociedades comerciais bem como um ambiente estável, seguro e acessível para indivíduos e famílias.

a ilha acolhe uma série de indústrias diversas dos sectores aeroespacial, bancário, de serviços financeiros, industriais, matricula de navios e aviões, da indústria espacial e da produção cinematográfica.

PORQUÊ ESCOLHER A ILHA DE MAN PARA OS SEUS NEGÓCIOS?

Localização: A Ilha de Man está situada no Mar da Irlanda, a meio caminho entre a costa noroeste da Inglaterra e da Irlanda. Beneficia de estar no mesmo fuso horário do Reino Unido e de ficar a uma hora de Londres de avião, o que contribui para torná-la o local preferido para a incorporação de empresas que não pertencem ao Reino Unido mas que pretendam obter uma listagem no AIM.

Taxa de Imposto sobre Sociedades de 0%: A Ilha de Man aplica uma taxa de 0% sobre o rendimento de sociedades comerciais ai sediadas com a excepção  de empresas no setor bancário ou cujo rendimento derive de imóveis sitos na Ilha de Man. Além disso, a Ilha de Man não tributa mais valias, nem aplica imposto de retenção na fonte ou imposto sobre a transferência de capital social.

Estabilidade política e econômica: em 2014, a Ilha de Man foi classificada como o oitavo país mais rico “per capita” pelo Banco Mundial sendo uma dependência autônoma da Coroa desde 1866. A estratégia econômica adoptada pela Ilha de Man permitiu-lhe beneficiar de trinta e um anos de crescimento econômico ininterrupto. A ilha também possui uma classificação de longo prazo Aa1 pela agencia “Moody’s”.

Localização vantajosa para negócios: a ilha goza de um acordo com a União Européia que permite a circulação de mercadorias dentro da UE sem impostos o que, em conjunto com um acordo sobre impostos alfandegários e de consumo com o Reino Unido, facilita o livre comércio com o Reino Unido. Os cidadãos da UE têm direito a viajar e residir na ilha sem restrições. O Governo da Ilha de Man também assegura um ambiente vantajoso para as empresas.

Subsídios à Deslocação: As empresas que escolham estabelecer-se na ilha têm à sua disposição uma grande variedade de subsidios.

Infraestrutura de classe mundial: a Ilha de Man possui infra-estrutura avançada de telecomunicações, o que atrai organizações relacionadas com as novas tecnologias.

E-gaming: O quadro regulatório da ilha, bastante vantajoso, estebelece um regime de licenciamento pragmático que pretende proteger o consumidor e potenciar o crescimento económico, levou a que empresas de jogos como a Pokerstars e a Microgaming se estabelecessem na Ilha de Man.

“Family Office”: A Ilha de Man tem-se vindo a tornar um local cada vez mais popular para o estabelecimento de escritórios de gestão de patrimónios familiares, ou “family offices”.

FinTech: nos últimos dez anos, o mundo assitiu a uma expansão tecnológica significativa, com uma percentagem cada vez maior das vendas de retalho realizadas pela internet. Muitas indústrias desenvolveram plataformas on-line e chegaram ao mercado novos conceitos em sistemas de pagamento informáticos, bases de dados de marketing e bases de dados de informações de clientes. A infra-estrutura da Ilha de Man fomenta esses tipos de organização.

PORQUE DEVEM INDIVÍDUOS E FAMÍLIAS ESCOLHER A ILHA DE MAN?

A substância é um factor cada vez mais importante no estabelecimento de um negócio internacional. A escolha de uma jurisdição atraente quer para o proprietário da empresa quer para os seus empregados de maior importância, que irão gerir o negócio desde esse local, é vital.

A Ilha de Man é consistentemente classificada como tendo um dos mais altos padrões de vida no Reino Unido e não há restrições à compra de imóveis para aqueles que não nasceram ou cresceram na ilha. Beneficia de uma excelente infra-estrutura e de um forte espírito comunitário, oferecendo educação de excelente qualidade combinada com uma das menores taxas de criminalidade no Reino Unido.

Regime fiscal competitive para individuos

• A taxa geral de imposto sobre o rendimento na Ilha de Man é de 10%, com uma taxa especial de 20%. Existem também limites de impostos disponíveis para individuos de elevado património.
• A Ilha de Man não tributa a sucessão ou a transferência de imóveis.

Como pode a Dixcart ajudar?

1. A Dixcart fornece uma gama completa de serviços fiduciários, desde a incorporação de sociedades até a assistência no estabelecimento de uma rede de escritórios de gestão de patrimónios familiares, ou “family offices”.
2. A Dixcart possui uma forte rede de contactos entre os sectores profissionais e comerciais da ilha e pode providênciar apresentações a indivíduos relevantes.
3. A Dixcart opera um “Business Center” situado numa localização privilegiada no principal bairro financeiro e legal da ilha na capital, Douglas. O “Business Center” oferece escritórios a empresas que procurem estabelecer-se na Ilha de Man, beneficiando de sofisticados sistemas informáticos e de comunicação (1 Gbps de conectividade de rede). A Dixcart também pode fornecer uma ampla gama de serviços profissionais quando necessário.
4. A Dixcart pode assistir indivíduos que pretendam mudar-se para a Ilha de Man. Podemos coordenar pesquisas de propriedades, seleção de escolas outros aspectos práticos.

Informação adicional

Se pretende obter mais informações sobre as vantagens oferecidas pela Ilha de Man, fale com David Walsh no escritório da Dixcart na Ilha de Man: advice.iom@dixcart.com.

A Dixcart Management (IOM) Limited é licenciada pela “Isle of Man Financial Services Authority”

A new Double Taxation Agreement between Malta and the Ukraine was ratified in 2017 and was made effective as from 1 January 2018.

As a result of this DTA, tax advantages for both countries are available and the Maltese holding company regime may prove attractive to Ukrainian investors. This DTA allows for dividends to be taxed in the country of source, at a withholding tax rate of 5%, if the volume of shares held is greater than 20%.

Taxation of Income

The tax treaty provides a low withholding tax rate on dividends, interest and royalties.

• Dividends

Withholding tax for dividends is capped at 15%. A lower rate of 5% applies to dividends received by a company owning at least 20% of the capital of the company paying the dividends.

Due to its full imputation tax system, Malta does not withhold tax on distribution of dividends, irrespective of the nationality, domicile or residence of the beneficial owner of those dividends.

• Interest and Royalties

Interest and royalty income is subject to a maximum 10% withholding tax.

The country of source has a limited primary right to tax the income, while the country of residence has a secondary right, with the obligation to grant relief from double taxation.

According to the Maltese Income Tax Act, interest and royalties received by non-residents is exempt from Malta tax and therefore no tax is withheld on such payments.

Additional Attractive Malta Double Tax Treaties

Malta has a network of over 70 double tax treaties.

In addition to the Ukraine, Cyprus and Switzerland have particularly beneficial double tax treaties with Malta.

Malta-Cyprus Double Tax Treaty

Foreign companies seeking to establish a certain type of entity in Europe, for example a company established for financing activities, should consider establishing a Cyprus company and managing it from Malta. This can result in double non-taxation for the passive foreign sourced income.

• The Malta-Cyprus Double Tax Treaty contains a tie breaker clause that provides that the tax residence of the company is where its effective place of management is. A Cyprus company with its effective place of management in Malta will be resident in Malta and would therefore only be subject to Cyprus tax on its Cyprus source income.

It will not pay Maltese tax on non-Maltese passive source income not remitted to Malta. It is therefore possible to have a Cyprus company resident in Malta that enjoys tax-free profits, as long as the proceeds are not remitted to Malta.

Malta-Switzerland Double Tax Treaty

Malta’s holding company regime, coupled with the beneficial Double Taxation Agreement between Malta and Switzerland, provides a number of advantages when a Malta company is used to hold shares in a Swiss subsidiary.

The key features of the Double Taxation Agreement are:

• The standard withholding tax on dividends paid from Switzerland is 35%. The agreement provides for a withholding tax exemption on dividends from Switzerland to a Maltese company, where the Maltese company directly holds 10% or more of the Swiss company’s capital for at least one year. Both companies must be subject to taxation.
• Interest received in Malta is taxed at 35%. However a shareholder can claim a refund from the Maltese tax authorities in respect of a substantial element of the taxation paid by the Maltese company relating to dividend payments to shareholders.  This results in low net Maltese taxation on interest, generally an effective Maltese tax rate of 10%.
• There is no withholding tax on royalties. This, coupled with Malta’s tax refund regime and unilateral double tax relief, in the form of a flat rate tax credit, results in very low net Maltese tax on royalty income.

Additional Information

If you would like additional information regarding the double tax treaty between Malta and Ukraine, or other Maltese Double Taxation Treaties, please contact Sean Dowden or Jonathan Vassallo at the Dixcart office in Malta: advice.malta@dixcart.com or your usual Dixcart contact.

Entrepreneur Government Funding

The Isle of Man has long been known as the home of entrepreneurs and innovators. This has been achieved over the years by playing to its strengths; strong communication with the private sector, supporting new ideas and ways of thinking, changing legislation quickly, and because it has wanted to lead not follow.

E-business has found a home in the Isle of Man with many companies becoming significant on-island employers.

The Isle of Man Government has launched an innovative Enterprise Development Scheme (EDS). The EDS is designed to allow the Isle of Man Government to provide new companies with a mix of loans and equity. The EDS involvement with the companies gives a large amount of support to new businesses and provides not just funding, but ongoing guidance.

The ideal EDS targeted business would be likely to be exporting their services from the Isle of Man and are, for example, E-business, Fintech, Media, Manufacturing, and, Bio Medical related. Eligible businesses include existing on-island businesses, early projects in their commercialisation phase, or simply businesses relocating to the Isle of Man to grow. Proposals that would be excluded from the EDS programme are companies that are exclusively trading on the island and have no exports.

The investment mix (debt/equity) is be based on a number of factors, not just the likelihood of complete success (profitable business and a financial return for the IOM Government) but also the employment opportunities for the island, the connectivity to other related industries on the island, the technology, and strategic economic nature of the investment (new sectors). Assessment and management of the investment is made by an independent manager, and an application can be supported by Dixcart.

How to Apply

All applications require an online enquiry form submission and an Isle of Man relevant business plan to be submitted to the Department of Economic Development. Dixcart can assist with this submission and can provide on-going support to a new company to the island, including:

• Accounting
• Company formation
• International advice and support
• On-going management and support
• Premises
• Recruitment
• Tax, VAT, and payroll support

The EDS funding comes in a range of forms as mentioned above either as a loan or equity investment. In addition, the Isle of Man also has a very generous grant assistance programme and Dixcart can provide further information on request.

The Three Main EDS Offerings Are:

Accelerator Scheme Loan

• Locally based business
• Ideally +5 employees
• Up to £100,000 loan on commercial terms
• Repayment term of between 1 to 5 years
• Purpose: loan to support capital, plant, equipment, premises and other tangible assets.

Accelerator Scheme Equity

• Locally based businesses and businesses relocating to the IOM
• Trading in export driven economic sectors
• Minimum of +5 employees
• Up to £250,000 equity investment as a minority shareholder
• Investment exit strategy anticipated to be within 3 to 5 years

Relocator Scheme

• New businesses setting up in the IOM
• Businesses relocating full or portions of existing businesses to the IOM
• Up to £1,000,000 as a minority shareholder
• Investment exit strategy anticipated to be within 3 to 5 years
• Minimum of 20+ employees

Additional Information

If you would like further information regarding the advantages offered by the Isle of Man, please speak to David Walsh at the Dixcart office in the Isle of Man: advice.iom@dixcart.com or to your usual Dixcart contact.

Dixcart Management (IOM) Limited is Licensed by the Isle of Man Financial Services Authority.