How to choose a holding company jurisdiction
Produced in partnership with Ben Jones and Colin Askew of Eversheds Sutherland (International) LLP
How to choose a holding company jurisdiction

The following Tax guidance note Produced in partnership with Ben Jones and Colin Askew of Eversheds Sutherland (International) LLP provides comprehensive and up to date legal information covering:

  • How to choose a holding company jurisdiction
  • An introduction to holding companies
  • Key attributes of a tax-efficient holding company
  • Checklist—key attributes of a holding company jurisdiction

An introduction to holding companies

For businesses expanding internationally, an important consideration is the corporate holding structure for the business and the location of the entities used to own and operate the expanding business.

Many commercial factors are relevant to this issue, including the nature of the business and its customer base, the location of key management and employees and access to finance and other support services, but taxation and tax efficiency is often also a key consideration.

From a tax perspective, there are typically two main objectives for the holding structure of an international business:

  1. minimising tax leakage on the distribution of profits and gains to shareholders and other beneficiaries, and

  2. enhancing tax efficiency through the implementation of a holding structure that will deliver tax benefits for the business

For both of these objectives, the location of the underlying business activities, any holding company and the ultimate shareholders will be key. The location of the underlying business activities and the ultimate shareholders will usually be fixed or subject to commercial requirements, but there is often flexibility regarding the location of holding companies. This flexibility allows tax efficiency to be a relevant factor in the choice of holding company jurisdiction or indeed whether or not to utilise a holding company.

While tax efficiency is a factor in the use of holding companies, there

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