Contact us
Eurofinanzza Services
Who we are
Offshore Introduction
Incorporating Offshore
Why Going Offshore
Why and when should I use Offshore
How to select an Offshore Jurisdiction
Structure of an Offshore Company
The Offshore for US Citizens
Going Offshore - Quick Answers
FAQ
Offshore Applications
Tax Planning – UK Citizens Working Abroad
Offshore Tax Planning Solutions - Musicians
Asset Protection
Estate Planning
Panama as a Banking Centre
The Best Banking Centers in the World
Overseas Jurisdictions
General information
Australia
Australia - Company Formation
Australia – Register a Branch of Foreign Corporation
Australia Company Formation - Incorporation Fees
Australia – Foreign Investment Regulation
Australia - Banking System
Australia – Financial Services Licensing Regime
Belize
Incorporating in Belize
Advantages to incorporate in Belize
Belize IBC Incorporation Fees
Setting up a Trust in Belize
Trust in Belize - Incorporation Fees
Mutual Funds in Belize - Incorporation and Fees
Bank Formation in Belize
International Insurance Licenses in Belize - Incorporation Fees
British Virgin Islands
Incorporating in BVI
BVI - Guarantee Company Formation
BVI - Offshore Mutual Funds
BVI - Incorporation Fees
BVI - License Fees
Canada
Canada incorporation - Introduction
Canada - For non Profit Corporations
Canada - Taxation
Canada - Incorporating in British Columbia
Canada - Incorporating in Nova Scotia
Canada - Real Estate Use of Offshore Companies
Canada - Offshore for Canadian Citizens
Canada - Incorporation Fees
Cayman Islands
Cayman Islands - Tax Exempted Company - Compliance Information
Cayman Islands - Incorporation Fees
China
China Business Services Overview
Doing Business in China - Forms of Entities
China - Representitive Office
Advantages of Hong Kong Holding Structure
China JV and WOFE Memorandum
Cook Islands
Cook Islands - General Features
Cook Island - Compliance and General information
Cook Islands - Wealth Protection Law
Cook Islands - Private Trustee Companies
Cook Islands - Trust Incorporation
Cook Islands
Cook Islands - Trustee Company - Incorporation Fees
Cook islands - Anonymous Confidential Tax Planning Asset Protections Structures
Cook Islands - Anonymous Confidential Structures
Cook Islands - Trustee Company - Incorporation Fees
Costa Rica
Costa Rica - Compliance Information
Costa Rica Double Taxation Treaties
Costa Rica -E-Gambling Corporation
Costa Rica - Incorporation Fees
Gibraltar
Incorporating in Gibraltar
Gibraltar - Tax Exempt vs. Non-Resident Companies
Gribraltar - E-commerce
Gibraltar Incorporation Fees
Trust in Gibraltar
Trust Formation in Gibraltar – Incorporation Fees
Hong Kong
Incorporating in Hong kong
Hong Kong Company Requirements & Formation Procedures
HK Non Profit Organization Charitable Institution
Hong Kong - Double Taxation Treaties
Hong Kong Taxation
Hong Kong – Double Taxation Agreement with Mainland China
Hong Kong Incorporation Fees
Opening Corporate Bank Account in Hong Kong
India
History of India - Overview
Investing in India - Country Incentives and Policy
Company Formation in India - Compliance Information
Taxation System in India
Company Formation in India - Incorporation Fees
Registration of Licensed Online Pharmacy
Isle of Man
Incorporating in Isle of Man - Limited Liability Company
Incorporating in Isle of Man LLC - Incorporation Fees
Jersey
Jersey Offshore Company incorporation
Trust formation in Jersey
Trust Formation in Jersey Islands – Incorporation Fees
Incorporating in Jersey – Tax Exempted Company – Incorporation Fees
Madeira Islands
Madeira Offshore - an International Business Centre
Incorporating in Madeira Islands
Taxation and Tax Treaties
Madeira - Incorporation Fees
Madeira - Links and Downloads
Mauritius
Mauritius Offshore Incorporation
Mauritius GBCII – Incorporation Fees
Nevis
Nevis - Company Formation
Nevis - Corporate Structures
Nevis - Limited Liability Company
Nevis - Trust Formation
Nevis - Offshore Bank Formation
Nevis LLC – Limited Liability Company – Incorporation Fees
New Zealand
New Zealand - Jurisdiction Information
New Zealand Look-Through Companies (LTC)
New Zealand - Company Statutory Information
New Zealand - Company Limited by Shares - Incorporation fees
New Zealand Foreign Trust - Overview
New Zealand - Incorporation of Foreign Trust
New Zealand Foreign Trusts - Incorporation Fees
How to Incorporate your New Zealand Asset Protection Structure
New Zealand Financial Services Company
New Zealand Finance Companies – FSP Licensed - Registration Fees
Offshore Banking Software for Financial Institutions
Links, Resources, International Compliance and Banking Regulations
Panama
Panamanian IBC
Panamanian IBC - Incorporation Fees
Trusts & Foundations - General Overview
Panamanian Trusts
Panamanian Trusts - Incorporation Fees
Panamanian Private Interest Foundations
Panama – Private Interest Foundation – Incorporation Fees
Panamanian Financial Corporations - Formation and Fees
Panama – Mutual Funds and Investment Corporations
Panama - Offshore E-commerce Solutions - Services and Fees
Seychelles
Incorporating in Seychelles
Incorporating an IBC in Seychelles – Incorporation Fees
St. Vincent & Grenadines
St. Vincent & the Grenadines – Jurisdiction Information
Advantages to incorporate in St. Vincent & the Grenadines
St. Vincent & the Grenadines – IBC Incorporation
St. Vincent & the Grenadines – Trust Formation
St. Vincent & the Grenadines – Mutual Funds
St. Vincent & the Grenadines – Offshore Bank Formation
St. Vincent & the Grenadines – Insurance Companies
St. Vincent & the Grenadines – Legal and Taxation Regime
St. Vincent & the Grenadines – IBC Incorporation Fees
Turks & Caicos
Incorporating in Turks & Caicos
Turks & Caicos – IBC Formation – Incorporation Fees
United Arab Emirates (UAE)
Incorporating in Dubai
Advantages to Incorporate in Dubai
Company Formation in Dubai
Incorporating in Dubai - Incorporation Fees
United States of America
Incorporating in US - C vs S Corporations
Forming a “C” Corporation in USA Delaware - Fees
US LLC - Limited Liability Company - Tax Advantages
The State of California
The State of Delaware
Advantages to incorporate in Delaware
The State of Florida
The State of Nevada
The State of New York
The State of Oregon
US LLC - Incorporation Compliance
US LLC – Limited Liability Company – Incorporation Fees
Delaware Series LLC - Fractional Ownership Purposes
Delaware Series LLC - Fractional Ownership Purposes - Incorporation Fees
US - incorporation States
US Foundations - Non profit Corporations
US Foundations – Non Profit Corporations - Articles
US Foundations – Non Profit Corporations – By-Laws
US Corporation Annual Fees
Uruguay
Uruguay - Incorporation Features
Investing in Uruguay
Uruguay SAFI and SA Company Formation - Incorporation Fees
 
 
 
 
 

 

INCORPORATING SPF COMPANY
IN LUXEMBOURG

 

LUXEMBOURG REPLACES 1929 COMPANIES
WITH SPF COMPANIES
“SOCIÉTÉ DE PATRIMOINE FAMILIALE”


The Luxembourg government launched the "Societe de Patrimoine Familiale" (SPF) to replace the 1929 holding company regime which was terminated on 1 January 2007 after it was found by the European Commission to be in violation of state aid rules for providing "unjustified tax advantages" to providers of certain financial services who set up holding structures in Luxembourg.

The SPF, or "Family Wealth Company", has the approval of the European Commission. Shareholders will be restricted to a small group of individual shareholders and SPF’s will not be available to listed corporations or large groups of unconnected shareholders.

They will be prohibited from commercial activity and limited to private wealth management, such as the holding of financial instruments such as shares, bonds and other debt instruments, in addition to cash and other types of bankable asset.

The new regime is to be exempt from corporate income tax, municipal business tax and net-worth tax, and from withholding tax on distributions. But these exemptions can be affected by the SPF's participation in non-resident, non-listed companies, if those companies are located in a country not subject to an equivalent corporate tax regime.

Companies participating in the new scheme must have a minimum capital level of EUR 12,500, one associate and one director in order to participate in the new regime. SPF shares can be nominative or bearer, but may not be quoted. If it is used to hold voting rights in other companies, it must ensure that it does not involve itself in the running of those companies, and it is prohibited from providing any kind of service.

There are about 14,000 existing 1929 Holdings in Luxembourg and those formed before 20 July 2006 will be able to keep their present status until 2010. Certain restrictions on transfer of ownership of the shares of those companies still need to be clarified. The new law is expected to apply to around 80% of 1929 Holdings and Luxembourg is apparently drawing up a further draft law to replace the remainder.

 

 

SPF COMPANIES
PRIVATE ASSET MANAGEMENT COMPANY

COMPANY FORM
The regime “SPF" can be chosen by a company whose form must be:

• Sarl: capital 12 500 Euro, one associate, one Director
• SA: capital 31 000 Euro (including at least 1/4 paid in), at least one shareholder and one director, one auditor
• SCA: capital 31 000 Euro (including at least 1/4 paid in), at least two shareholders and three directors, one auditor
• COOPSA: Co-operative Company having adopted the Form of a Limited company, at least three associates, 3 directors.

ADVANTAGE
Variable capital

SHARES OF A SPF
The shares of a SPF can be nominative or at the bearer but cannot be quoted.

ACTIVITY
The activity is strictly limited to acquisition, detention, management and realization of financial assets such as:

Shares, obligations, shares of quoted companies or private companies, securitisation funds, Soparfi shares, variable capital companies, Holding 1929 (within the limits of the Law - 19/07/06), deposit accounts, SICAV, Luxembourg or foreign investment funds, structured products, hedge funds, precious metals, options, warrants, indices, currencies, ... to guarantee or make non bearing interest loan to its subsidiaries.

The SPF cannot carry out commercial deals, hold building, intellectual rights or carry on an activity of management, trade or financial services.

It can obviously hold a subsidiary company which carries out such operations.

DEBT
According to the Form of company chosen, the “SPF” can issue securities, contract debts with its shareholders, with third parties like banks, natural persons, legal entities or other entities -resident or non resident... There is not maximum debt equity ratio; only the subscription tax is due on the debts part which exceeds 8 times the increased paid-up capital of the capital premiums.

SHAREHOLDERS
The shareholders of this SPF must be:

1) individuals (other than company) resident or non resident
• a family group;
• a Family office;
• a investment club;
• a group of investor managing their private savings.

2) Entities known as managing patrimonial assets, resident or non resident:
• trusts;
• private foundations;
• stitching;
• administrative kantoor ;
• similar entities with or without the legal personality acting within the management individuals’ assets;
• Any type of nominee agreement by intermediaries holding the shares of the SPF as fiduciary (banks acting within a fiduciary contract, mandate).

 

FISCAL REGIME OF THE “SPF”

TAXATION AT THE CONSTITUTION
Capital Duty of 1% (0.5% from 1/01/2008) at the constitution with possibilities of exemption:

• on the part of the debt or the advance towards the shareholders or the third parties - max 8 X the subscribed capital (for subscription tax);
• when the contribution is the majority of the shares of a company having its registered office in the European Union (>65%);
• when there is a transfer of registered office from a Member State of the EU towards Luxembourg in so far as a similar duty was charged at the constitution;
• when there is a change in the form of a Luxembourg Company into a SPF form (holding 1929, Soparfi ...);
• when there is the incorporation of reserves or deferred results to the capital,...

TAXATION OF PRODUCTS, BENEFITS, DIVIDENDS OR OTHER PROFITS PERCEIVED OR CARRIED OUT BY THE SPF BECAUSE OF ITS SOCIAL OBJECT
Total Exemption of income tax, communal tax but exclusion of all tax treaties.

WITHHOLDING AT SOURCE ON THE INTERESTS PAID ON THE
ADVANCES AND DEBTS OF THE SPF TOWARDS THE INDIVIDUALS

• If Luxembourg resident: either Final withholding at the source = 10% (see article on law RELIBI) – or global taxation
• If not a Luxembourg resident: Final withholding tax at the source = 15 % (saving directive)

WITHHOLDING TAX AT SOURCE
No withholding at source on the interests is to be paid on the advances and debts of the SPF towards the legal entities or other entities.

WEALTH TAX
Exemption

MOTHER SUBSIDIARY TREATY OR INTERESTS ROYALTIES
DIRECTIVE

Exclusion

ANTI ABUSE MEASURE
Interdiction of perception of more than 5% of its Dividends coming from non-resident and non-quoted companies (Ex EU) whose rate of taxation is lower than 11% (this measure only applies to dividends coming from these companies – so do not apply to capital gains, repurchases of capital stock, profit of liquidation, security lending...)

WITHHOLDING AT THE SOURCE ON WAGES PAID TO EMPLOYEES OR DIRECTORS
According to scales with reduction and exemption, following the situation of the Beneficiary

WITHHOLDING AT THE SOURCE ON DIRECTORS’ FEES
20%

VAT
No registration possible

SUBSCRIPTION TAX
- Taxable basis= paid-up capital (CL) + capital premium (CP) + debts exceeding 8 times (CL+CP) (existing at January first)
- Rate = 0.25 % per annum with a minimum of 100 Euro and a maximum of 125 000 Euro
- The tax is payable per quarter (and pro-rata by day for the first and last exercise)
- The profit/Loss or the reserves are not taken into account in this calculation.

TAX ON THE CAPITAL GAIN REALIZED ON SPF’S SHARES
Taxation for Luxembourg resident
Exemption for non-resident person

TAX ON THE PROFIT OF LIQUIDATION
Taxation for Luxembourg resident
Exemption for non-resident person

 

CONTROL AND SUPERVISION OF THE SPF

1) Only the “Administration de l’Enregistrement” is qualified. This administration is different from the Tax authorities. Control is strictly limited to the respect of the conditions of the SPF Regime. No spontaneous or no information communication can be carried out by this administration except in the event of non-respect of the obligations of the SPF itself.

2) Each year, the domiciliation agent (a chartered accountant, an Auditor...) must certify:

• that the SPF is held only by qualified investors (the name of these people is covered by its professional secrecy and he cannot reveal it);
• that the SPF does not perceive more than 5% of its dividends coming from companies ex EU taxable at less than 11%;
• that the SPF respected its obligations as a paying agent following the law “relibi” and the directive on the savings taxation.

It is indeed a certificate of non-objection from the paying agent to the attention of the Registry Administration. If this administration does not receive the certificate of non-objection, it informs the Tax authorities of it and the withdrawal of the benefit of the SPF Regime can be declared (applicable starting from the reception of the registered letter).

3) The SPF must keep a proper accountancy and publish its annual statements once per year, respect the provisions of the company law and the law on Domiciliation of companies if applicable.

For a more precise analysis, please contact us.


OFFSHORE INCORPORATION SERVICES
COMPANY FORMATION & MANAGEMENT SERVICES
TAX PLANNING AND ASSET PROTECTION SOLUTIONS
INTERNATIONAL BUSINESS COMPANIES
HOLDING COMPANIES
PRIVATE LIMITED COMPANIES
LIMITED LIABILITY COMPANIES
LIMITED LIABILITY PARTNERSHIPS
TRUSTS
PRIVATE & FAMILY FOUNDATIONS
BANK FORMATION
PANAMANIAN LICENSED FINANCIAL CORPORATIONS
NEW ZEALAND OFFSHORE FINANCIAL INSTITUTIONS
SECURE & CONFIDENTIAL NOMINEE STRUCTURES
INCORPORATION IN EUROPE AND
MAJOR INTERNATIONAL OFFSHORE CENTRES
OFFSHORE BANKING
WORLDWIDE FULL SERVICED VIRTUAL OFFICES

FREE CONSULTANCY

info@eurofinanzza.com

 

European Jurisdictions
Andorra
Austria
Cyprus
Czech Republic
Denmark
France
Greece
Hungary
Italy
Latvia
Liechtenstein
Luxembourg
Malta
The Netherlands
Portugal
Republic of Ireland
Spain
Sweden
Switzerland
United kingdom
Shelf and Aged Companies
Nominee Structures
Virtual Offices
Offshore Banking
Offshore e-Commerce
VAT
Website Design
Relative Services
Currency converter
Contact us
Menu