Stocks investments company

[bisk]

I would like to create a company that would invest in shares on stock exchanges around the world. I am EU citizen and resident.

I hope for:
- 0% tax on capital gains
- EU-friendly solution
- preferably no audits, because of costs
- preferably no accounting or cheap, because of costs
- preferably no license, in case of funds etc.

But probably there's no best solution. Trading using personal account would result in high personal tax.

Can you suggest company jurisdiction, company type and bank account jurisdiction?

 

[Artemis Eleutheria]

US - Interactive Brokers account held via Ontario LP checks all your boxes ... however depending on tax code whereever you are resident it might be that they still would want a slice of that pie ... if you make money that is.

 

[GrumpyMess]

But probably there's no best solution

The solution highly depends on your current residence, read about CFC laws in your country

Ontario LP

Ontario or any other LP makes no sense in this situation

 

[John Andrews]

forget 0% tax if you want to stay in the EU.

as Grumpy said, first check CFC rules.

 

[Artemis Eleutheria]

The solution highly depends on your current residence, read about CFC laws in your country


Ontario or any other LP makes no sense in this situation

Ontario LP checks all his boxes ... however as you also have pointed out the issue isn't on the company level ... but related to his country of residence.

 

[bisk]

My residence is non-dom Malta. Ontario LP won't be taxed in Canada and it won't be taxed in Malta because of territorial basis. However CFC can be a problem.

What do you think about Luxemburg SPF?

 

[GrumpyMess]

My residence is non-dom Malta.

Do you actually live in Malta or just having a residence? Did you requested a tax residence certificate? How smooth it goes with malteese residence in general?

 

[bisk]

Do you actually live in Malta or just having a residence? Did you requested a tax residence certificate? How smooth it goes with malteese residence in general?

I live here. You cannot request a tax residence certificate by yourself. Only banks and governments can do that. For EU citizens it's easy to get any other EU residence if you move there.

 

[celizo]

Trading using personal account would result in high personal tax.

What is the personal tax to pay in Malta?

 

[bisk]

Hi, what are the advantages to use a company instead of a personal account at IB for a maltese resident? Only in order to have products available uniquely for professionnals?

Active trading in Malta is taxed at 35%, even when profits are received abroad.

 

[celizo]

Okay, and what are the criterias of "active trading" versus passive Investments in bonds/stocks please?

 

[Artemis Eleutheria]

My residence is non-dom Malta. Ontario LP won't be taxed in Canada and it won't be taxed in Malta because of territorial basis. However CFC can be a problem.

Maybe ...

"an entity or permanent establishment with accounting profits of no more than €750,000, and nontrading income of no more than €75,000 or of which the accounting profits amount to no more than 10% of its operating costs for the tax period falls outside scope of CFC taxation."

https://www.ey.com/Publication/vwLUAssets/Maltese_Government_adopts_law_to_implement_EU_Anti-Tax_Avoidance_Directive_-_NID_rules_approved_by_EU_Code_of_Conduct_Group/$FILE/2018G_012408-18Gbl_Malta%20Law%20to%20implement%20EU%20ATAD%20and%20NID%20rules%20approved.pdf

 

[celizo]

Can you suggest company jurisdiction, company type and bank account jurisdiction?

And what about a scottish SLP? Probably easier for a bank account in UE.

 

[Martin Everson]

Just open an Estonian company with LHV bank account and use their IB white label platform to trade or IB directly. You don't pay any corporate income tax in Estonia for profits that are not distributed also so re-investing and compounding is possible. Just get written approval from Malta Commissioner that this does not affect your non-dom tax status for CFC purposes. You should do this anyway for any offshore structure you plan while being a non-dom in Malta.

 

[John Andrews]

Just open an Estonian company with LHV bank account and use their IB white label platform to trade or IB directly. You don't pay any corporate income tax in Estonia for profits that are not distributed also so re-investing and compounding is possible. Just get written approval from Malta Commissioner that this does not affect your non-dom tax status for CFC purposes. You should do this anyway for any offshore structure you plan while being a non-dom in Malta.

I agree that Estonia is probably the best option but how do you get the money out then?

Also how would you combine this with asset protection if one is a resident in EU?

 

[Martin Everson]

I agree that Estonia is probably the best option but how do you get the money out then?

Same way as any other company and you will be taxed for it. Estonia company has advantage for real investors in that you can delay paying any taxes until a time of your choosing.

Also how would you combine this with asset protection if one is a resident in EU?

The best asset protection you can have is leaving the EU.

 

[Joe Blasco]

Hi there, i am interested in exactly same thing and I was intrigued by the Ontario LP suggested by Martin Everson. However how is possible to open an account for this type of company in Canada ? in this thread Canada LP (for non-residents) fellow member Derbo8 says that is impossible. Any ideas pls for the bank account???

 

[Joe Blasco]

sorry Artemis-Eleutheria suggested Ontario LP to give credit where it is deserved...