Portugal 2015 October 2015 Restricted use Kevin Valenzia

Transcription

1 Malta Portugal 2015 Restricted use Kevin Valenzia

2 Agenda Kevin Valenzia - ( Malta), Malta tax and other matters Jaime Esteves - ( Portugal), Portuguese fiscal matters Robert Walker - (Rathbone Brothers plc), investments Andrew Piggott - (Grosvenor Insurance), insurance Steve Burdett - (Strategic Wealth Limited) and Paul Ockleford - (Willow Trust Guernsey Limited), QROPS & QNUPS Darren Mills & Steve Whittam - (Strategic Wealth Limited), financial advice 2

3 Key Statistics Land size 316 square kms Population (2013) c. 423,000 Unemployment (Nov 2014) 5.8% Inflation rate (Dec 2014) 0.4% GDP (2013) US$9.642 billion GDP per capita (2013) 86% of EU average - 22,780 3

4 An Overview An independent democratic republic within the British Commonwealth A member of the European Union A developed economic and industrial structure High educational standards Maltese and English official languages Forms part of the Schengen Area Largely unaffected by economic crisis economy still growing 4

5 Typical structure Beneficial owner Abacus Holdings Ltd Malta company Abacus Holdings Ltd sole director Right to use Property in Portugal 5

6 Taxation issues Sale of shares in a Malta company In terms of Maltese law if shares in a company owned by non- residents are sold to another non-resident of Malta, whether an individual or a company, then there should be no stamp duty nor capital gains payable in Malta on this sale If a Malta Company sells the property then the profit arising will be subject to tax in Malta at 35%, with credit being given for any overseas tax suffered thereon. (Upon distribution of profit, refunds of Malta tax are normally applicable so that effective tax burden in Malta, after Portuguese tax, should be around 0%) It is advisable to sell the shares of the company and not the property 6

7 Taxation issues Disposal/rental of property A company incorporated/registered in Malta is considered to be both resident and domiciled in Malta for Maltese tax purposes on the basis of its incorporation/registration, and is consequently subject to tax in Malta on its worldwide income, including therefore on the rental income received or capital gains, if any, arising from the disposal of the said immovable property 7

8 Taxation an example At the level of the Company: Euro Net rental income 835 Grossing up of tax withheld in Portugal 165 Chargeable income 1,000 Corporate tax at 35% 350 Credit treaty/unilateral relief (165) Malta tax payable 185 8

9 Taxation an example At the level of Shareholder: Euro 2/3rds refund of gross tax suffered by the Company (not taxable) 185 * Effective Malta tax payable - tax paid in Malta by the Company tax refund received by shareholder (185) Effective tax leakage in Malta post-refund 0 Effective tax rate in Malta 0% *(=2/3 of 350, limited to 185) 9

10 Critical Success Factors Lower costs Quality of life convenient Europe time zone Accessibility/ flexibility of regulator High quality workforce fluent in English Attitudes and work ethic Professional services Can do attitude Stability 10

11 Critical Success Factors Relative ease of incorporation for non-regulated entities Audited accounts must be prepared and filed for public inspection Low minimum capital requirements ( 1,165) No local shareholders or directors required Low registration and maintenance costs Share capital, accounting, and tax in a foreign currency Possibility of flighting companies to and from Malta - redomiciliation Possibility for licensed trustees as registered shareholders Choice of accounting year-end 11

12 Critical Success Factors No exchange controls Low incorporation and authorised capital fees Exemption from stamp duty on share transfers 12

13 KYC procedures We want to work with clients that demonstrate high standards of conduct Before accepting to provide services to a client/organisation, we need to obtain due diligence documentation on the client /organisation as part of our client acceptance procedures and antimoney laundering regulations Our aim is to know who our client is, and to be satisfied that their character and reputation is such that we wish to be associated with them and provide services. We also need to satisfy ourselves that the proposed activities make sense and are legitimate 13

14 KYC procedures A letter of engagement needs to be in place and the documents normally required for an individual shareholder are as follows: apostilled copy of passport or copy of passport duly certified by Maltese embassies or consulates, well known banks, lawyers, or other offices Original utility bill confirming residential address, issued less than 3 months previously Details of previous business history and background (curriculum vitae) Details of directorships in other companies; and Two character references for each shareholder (one directly from a bank and one from a lawyer/professional adviser/ office). The character references should be sent directly to our offices Should the shareholder not be an individual but a company/trust other documentation will be required 14

15 Compliance Obligations Financial Statements In terms of Maltese law, accounts need to be prepared on annual basis by the Company s Directors and audited by a local auditor. Accounts need be prepared in accordance with International Accounting Standards. Under Maltese law, accounts are drawn up in the same currency as that of a company's share capital Information and documentation required to enable the Directors to prepare accounts:- An estimate of the market value of the property owned by the company in Portugal so that this value is reflected in the accounts in accordance with International Accounting Standards 15

16 Compliance Obligations Details of any construction or improvement works carried out in respect of the property during the year Details of any income received by the company in relation to the property during the year (if applicable) Confirmation that the property has been properly insured in the name of the company together with a copy of the latest insurance certificate for our records Details of any expenses to be charged to the company The accounts, once approved by the beneficial owners, will need to be approved (signed) by the company s directors and auditors within 10 months from the end of the company s financial period and submitted to the Registrar of Companies 16

17 Compliance Obligations Tax returns The general rule for the filing of tax returns, which need to be accompanied by audited accounts, is the later of 9 months after year end or 31 March of the following year 17

18 in Malta 19 partners and 500+ people. Largest professional services firm in Malta. Full range of services offered assurance, advisory, tax, and IT (125 people in our tax services line) Existing client base is wide ranging both corporate and individual with clients from a number of jurisdictions (typically jurisdictions with which Malta has a double tax treaty in place). Strong relationships in place with local relevant businesses Close relationships with network 18

19 Malta contacts Kevin Valenzia E: T: Natasha Parnis England E: T: Joanna Pace Balzan E: T:

20 Data Classification Policy: Restricted use (DC 2) This presentation has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it. Copyright 2015 PricewaterhouseCoopers. All rights reserved. refers to the Malta member firm, and may sometimes refer to the network. Each member firm is a separate legal entity. Please see for further details.