With the billionaires I’m not surprised because they probably usually actually aren’t involved in the daily operations of their businesses. If you own a factory in China, then I’m pretty sure even a country like France wouldn’t tax you (well, maybe if they have a wealth tax). Because it’s clear that the company is operating outside of France, has substance etc. Only dividend payments would be taxable.
The UK/Malta/Singapore doesn’t tax those dividends (subject to certain conditions), unless they are remitted to that country.
Which is nice.
But even in France, you could simply accumulate savings in the company, although the company might have to pay corporate income tax on capital gains.
Correct so far?
The thing is that for example France definitely will be very strict when it comes to such arrangements. The French tax office will demand proof that the director gets paid a decent wage, they will want to see an office and a reason for running the operations in that country, and so forth.
But you say that’s not the case with Malta/Singapore/the UK? They are fine with a company in the Bahamas, as long as you go there from time to time? I’m asking because the SG tax office makes it very clear that if the company is effectively managed from Singapore, they will definitely consider the income locally sourced and thus taxable. But maybe that’s just the official language, so they don’t end up on some blacklist?
What about Switzerland/Liechtenstein? They are probably stricter with substance requirements?
Your example with france is slightly different because they have heavy witholding taxes, so if tomorrow you have accumulated 10m€ in a French SA and decide to move to gibraltar, you will not be able to take out the 10m€ as dividends without paying a heavy french dividend tax.
In the case of the UK, you don't need to go to Bahamas at all, you can go to Paris, to Italy, etc. so essentially every time you take a holiday you make sure to do a board meeting. This only works if you pay your taxes on the remittance basis -- otherwise, the requirements for substance are much higher.
Switzerland/Liechtenstein are horrible places tax-wise. CH is very good if you can afford forfait status and it's more and more difficult to get.
Honestly I'd advise you to pay someone to give you a proper written advise, I'm not trying to sell our services, but it depends so much on the type of business that you do, how often you travel, what running costs you have, how much intellectual property you have, how much working capital is required, is there debt that can be swapped etc.
If you ask on our chat, someone from our team can probably organize a call with you and figure out the right structure for a couple of 1000's, otherwise you can talk to tier-2 advisory firms like Mazars, BDO, etc. they'll do it for 50k-70k or a Big Four, count > 120k
