Incorporation in the Netherlands — Less Taxes and a Reliable Company Location

Psoted on: March 22, 2021 at 1:25 pm, in

Overview:

  • The Netherlands offers feasible tax policies to companies registered here.
  • The country’s economy is stable and has a moderate growth rate, which plays a key role in the prosperity of businesses in this jurisdiction. 
  • Forming a company in the Netherlands provides an excellent way to enter the EU market. 
  • Clevver offers support for the incorporation in the Netherlands and digital access to all business registration documents.

The United Kingdom of the Netherlands is one of the most developed countries in Western Europe. It is distinguished by economic stability, a low level of crime and unemployment, and an advantageous geographical position. All this, as well as the presence of double taxation treaties, allowed the Netherlands to gain high popularity in foreign entrepreneurs who want to incorporate a business here. 

Many business owners register companies here in order to optimize taxation without harming the business’s financial reputation. If you have far-reaching plans, and they imply cooperation with significant business partners in Europe, then, there is no better state for registering a company than the Netherlands.

The Netherlands Tax Policies

To date, the Netherlands is a respectable jurisdiction, a member of the European Union, which offers loyal tax conditions for doing international trading. A country is a good option for registering a business aimed at the EU market. In general, the Netherlands has a fairly high level of taxes – income tax ranges from 20% to 25%.  

However, a special tax regime exists for holdings: it is possible not to pay taxes (or pay, but at low rates) on dividends, capital gains, and royalties. For this, certain conditions must be met. 

Here, they are: 

  • Firstly, the holding must own at least 5% of the shares of the subsidiary.   
  • Secondly, the subsidiary must pay taxes at the place of registration at a rate of at least 10% or invest in other companies at least 50% of the assets. Also, the subsidiary must not be a portfolio investment for the holding.

Dutch holdings are very often used for asset protection, intellectual property ownership, or as the headquarters of international holding companies. This is due to the country’s good business reputation and tax incentives. The most famous transnational companies with headquarters in the Netherlands are Nike, Netflix, Google, Fujifilm, and many more. 

Regardless of the industry your business operating in, the Netherlands can open the door to success in Europe and beyond it. Clevver is ready to provide you with the possibility to incorporate a legal entity in the country remotely. Click here to see details.

Benefits of Incorporating in the Netherlands

  • Loyal tax legislation for foreign entrepreneurs. Only those entrepreneurs who receive income in the country pay taxes. If it was received outside the Dutch state, then the tax payout is not required.  
  • Wide opportunities for establishing business relations and cooperation with European companies. The opportunity to raise profits by several times rockets by increasing the number of export-import transactions.  
  • Strong government support for business. Company owners are under the legal protection of the state. For entrepreneurs, including non-residents, the state has developed many preferential programs. In the Netherlands, low-interest rates are offered to business owners by banks.  
  • Respectable jurisdiction. The Dutch legal system is clear and transparent. It eliminates the risk of any kind of economic manipulation and any kind of fraud. The presence of a Dutch company increases the reputation of the legal entity in the international market.

Incorporation in the Netherlands

Company registration in the Netherlands — it is always close attention to the aspects of the matter, a highly qualified team of professionals, and the digital process of Clevver’s assistance in company formation.

What we offer:

  • Online process of cooperation with Clevver;
  • Provision of a comprehensive set of documents for incorporation of a BV; 
  • All documents for business registration are available digitally;
  • Consistent customer support.

Final Thoughts

If you want to minimize tax burdens on your business and maintain an impeccable business reputation in the eyes of potential European partners — choose the “right” country for incorporation — the Netherlands fits the concept in the best way.  

Clevver.io is ready to take care of all organizational issues related to the incorporation of a business in the Netherlands. Use the services of our company and make your business prosper. Make an inquiry now!

DISCLOSURE NOTICE: Any legal or tax advice in this communication (including any attachments) is for information purposes only and is not intended to be used, and cannot be used against Clevver or its Sender. The sender is neither an Accountant nor a Lawyer and cannot be made liable. Please, contact your tax accountant for individual consultation. Clevver does not provide any legal advice itself. Clevver works together with a network of lawyers and tax advisors that provide all necessary individual legal advice.


Double Irish with a Dutch Sandwich — Legal Cuisine

Psoted on: December 17, 2020 at 11:36 am, in

It’s about time that we educate you about the most appetizing tax scheme known by the name Double Irish with a Dutch Sandwich. What does it do? It is associated with minimizing the tax burden when using intellectual property. This system is widely used by American corporations and is slightly less common among European companies, but it is still present there.

Why Do Companies Use “Double Irish with a Dutch Sandwich” Scheme?

So, to begin with, we should turn attention to the prerequisites for using this method of minimizing taxes. If we consider the United States, then income received from intellectual property (royalties) is subject to a very significant tax – 35%. At high turnovers, this interest rate is incredibly burdensome for companies. As a consequence, many firms use tax optimization. This should not be confused with tax evasion. Optimization is the reduction of the tax burden by applying legally acceptable mechanisms.

Famous companies such as Apple, Google, Facebook, Coca-Cola, and others appear among the notorious cases of the “double Irish with a Dutch sandwich” scheme. For example, Google allegedly underpaid about 1 billion Euros in taxes to the French budget for 2016, due to tax optimization.

“Double Irish with a Dutch Sandwich” Peculiarities

Now, let’s move on to the “tastiest” part, and consider the structure of such tax planning and how the above media giants managed to significantly save on tax payments.

This scheme is a kind of chain, through which intellectual property rights are transferred from one company to another. This chain uses two Irish companies and one company registered in the Kingdom of the Netherlands (hence the name “double Irish with a Dutch sandwich”).

Under Irish law, a company is considered a resident of the country from which it is directly managed. Thus, a company incorporated under Irish law with an office and a current director in another country will be considered a resident of the latter. The first Irish company (hereinafter we will call it I1) is geographically located in an offshore zone – in Bermuda or the Cayman Islands, in which dividends and royalties are not subject to income tax. The second Irish company (hereinafter I2) is already registered and located in Ireland, but at the same time, it is a 100% subsidiary of I1. The third company is registered in the Kingdom of the Netherlands (hereinafter – N).

The very scheme of interaction between companies is as follows: A company that owns the intellectual property (located in a high tax area, for example, the United States) transfers intellectual property rights to I1 through a licensing agreement, then I1 sublicense these rights to the company N. The Dutch company, in turn, also transfers sublicense agreement with the same rights to I2. It directly collects profits from the use of intellectual property rights and conducts real business (excluding US consumers). This is because Ireland does not tax funds that are transferred by its residents to some countries of the European Union, incl. Kingdom of the Netherlands. In this case, I2 must pay tax only on the part of the income received from royalties, which it retains with itself (at a rate of 12.5%). From the Netherlands, funds are transferred to I1 (also bypassing taxation), which is a tax resident of the offshore zone, in which it is exempted from paying taxes for royalties. As a result, money is concentrated in the offshore jurisdiction. The popularity of the described scheme is confirmed by media reports, according to which foreign companies carried about 13 trillion euros through the Kingdom of the Netherlands in 2012.

Final Thoughts

It is worth remembering the worldwide trend towards de-offshorization and the introduction of BEPS rules, which are aimed at eradicating such phenomena. This means that in the near future such ways of tax optimization will be closed and global corporations, together with their lawyers, will have to look for new options for tax planning or pay taxes in the form in which they are provided by law. Already in 2017, US authorities directed corporations to end the system. Ireland is pressured to close this loophole.

Our Offer to you

Clevver can assist with the establishment of a Dutch Sandwich for you on demand. Also, Clevver can support the company formation in other alternative European jurisdictions like Switzerland or Malta.

Get in touch with us at [email protected] for more information.

DISCLOSURE NOTICE: Any legal or tax advice in this communication (including any attachments) is for information purposes only and is not intended to be used, and cannot be used against Clevver or its Sender. The sender is neither an Accountant nor a Lawyer and cannot be made liable. Please, contact your tax accountant for individual consultation. Clevver does not provide any legal advice itself. Clevver works together with a network of lawyers and tax advisors that provide all necessary individual legal advice.


10 Reasons Why Move Your Business to Ireland or the Netherlands before Brexit Gets Finalized

Psoted on: December 1, 2020 at 5:10 pm, in

Great Britain is one of the most important economic players. For that reason, all eyes are on Brexit – on December 31 this year, the UK finally and irrevocably leaves the EU, impacting trade relationships globally. That is why many business owners are looking for a suitable way out of this situation. Which solution is the smoothest for most businesses? Our data shows – most companies choose to incorporate in neighboring Ireland or the Netherlands. 

Below, there are conclusive reasons why registering a business entity in one of these countries should be your obvious choice to deal with the aftermath of Brexit.

Ireland

Benefits of incorporating in Ireland?

  • EU Membership

People starting a company in Ireland will continue to profit from the efficiency of selling both within and outside the European Union. Also, Irish businesses will have no problem with the smooth flow of skilled labor.

  • Closeness to Great Britain

While the UK is likely to suffer after Brexit, it remains one of the world’s leading economies and one of the world’s most developed consumer markets, especially in the area of ​​e-commerce. Set up your business in Ireland and you get all the benefits of EU membership while remaining in close proximity to the 4th largest market in the world. Besides, Ireland will be the only country with a land border with the UK.

  • Excellent Business Reputation

Ireland is ranked the 8th best country to start a business in the world, according to the World Bank’s 2018 Doing Business report. It has also been the fastest-growing country in Europe since 2014 and has attracted over 700 US companies to date, bringing in over $300 billion in investment over that period.

  • Favorable Tax Climate

Ireland is also an extremely tax-friendly destination. The corporate tax rate of 12.5% ​​is one of the lowest in Europe, 6.5% lower than the UK and 2.5% less than Germany. If your entire business is conducted outside Ireland, you are also eligible for a full tax deduction on this foreign income. If you do business in Ireland, the country has 73 double taxation treaties, which prevents you from taxing most of your foreign income twice. As a result, Ireland is ranked 4th in the world in paying tax policies.

Do you want to learn more about incorporation in Ireland with Clevver’s support? Talk to our experts, or read more here.

The next most popular Brexit-proof destination? The Netherlands!

The Kingdom of the Netherlands obtains a leading position in the economic development of the EU. Running a business in the Netherlands is one of the most certain ways to overcome the negative effects of Brexit.

The Netherlands is at the forefront of economic development in the Eurozone. The country’s authorities strive to attract foreign investment and specialists capable of introducing innovative technologies in various spheres of production. The procedure for starting a new business in the Netherlands is easier than in other EU countries. Especially now, in a time of uncertainty (Brexit with or without a deal), registering your company in Holland is the most painless way to maintain a presence in the EU.

There are many opportunities for registering and developing small businesses. Moreover, if your company’s activities have a positive impact on the Dutch economy, you might qualify for government assistance at the start-up stage.

Benefits of incorporating a company in the Netherlands?

  • Membership of the EU, obviously

This provides lower costs due to the disappearance of border formalities and all kinds of specific national regulations, as well as the better functioning of the labor market, as companies can more easily attract suitable personnel from abroad.

  • The high business prestige of the Netherlands internationally

The Dutch GDP per capita is one of the highest in the world. And in contrast to other high-ranking countries, the income distribution is rather even. This means that a large part of the population has quite some money to spend which enables successful business making.

  • Business-enabling legislation

It’s easy to set up a business. The Netherlands ranks number 27 on the Ease of Doing Business Index, and setting up a company can be done through a public notary in just a few days.

  • The stable economic and political environment

This is mainly due to the very low level of unemployment and a boost from higher government spending.

  • The local taxation system is clear and transparent

A solid combination of the corporation tax rates in the Netherlands and financial incentives make the country a reliable choice as a base for international operations. The Dutch Tax Authorities have a flexible and practical approach, with a proactive attitude.

  • No double taxation

To prevent you from paying income tax on the same income in several countries, you can obtain tax relief in the Netherlands in order to avoid double taxation. The double tax relief only applies to the income tax.

Do you want to learn more about incorporation in the Netherlands with Clevver’s support? Talk to our experts, or read more here.

Clevver perks

From the practical, logistical, and financial points of view, setting up a company in Ireland or the Netherlands is difficult to beat.

How can Clevver help you? We now offer 10% off on the assistance with the incorporation in Ireland and the Netherlands

Send an inquiry now with a promo code BREXIT

Incorporation in the Netherlands

Incorporation in Ireland

or, email us at [email protected]

DISCLOSURE NOTICE: Any legal or tax advice in this communication (including any attachments) is for information purposes only and is not intended to be used, and cannot be used against Clevver or its Sender. The sender is neither an Accountant nor a Lawyer and cannot be made liable. Please, contact your tax accountant for individual consultation. Clevver does not provide any legal advice itself. Clevver works together with a network of lawyers and tax advisors that provide all necessary individual legal advice.