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Trading and Service Structures
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Invoicing activities related to trading or the provision of services (e.g., consultancy) may require a structure involving a Spanish, United Kingdom, Netherlands, Danish, Swedish or low tax trading company. Where a trade company in a high-tax jurisdiction is used, it may enter into a service or representation agreement (i.e., agency agreement) with a low tax company (usually the Principal). Under the terms of such an agreement, the trading company agrees to perform certain activities at the risk and on account of the low tax company. This structure can minimize taxation in high tax jurisdictions and maximize profits in the low tax jurisdictions.
Example: The trading company purchases and sells goods on behalf of the low tax company. It then pays an arms-length price to the low tax company from its sale receipts. In the same manner, for a fee, the trading company may render services and/or engage a party to obtain/perform such services. Likewise, a portion of the profits may be sent to the low tax company, the trading company retaining a service/consultancy fee.
Amicorp can provide trade structures in Hong Kong, Cyprus, the United Kingdom, the United States, Spain, Denmark, Sweden, Luxembourg, The Netherlands, the Netherlands Antilles, the British Virgin Islands and Costa Rica.
For more information on Amicorp’s low tax trading structures,
company formation & incorporation services
company formation & incorporation services
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