Holding Company

Holding companies can be useful whether established in certain onshore jurisdictions or offshore jurisdictions and there is a distinction between those used for commercial collection and routing of dividends and those for holding private property.

Commercial Holding Company

Certain jurisdictions such as Denmark, Holland, United Kingdom and Hungary, amongst others, because of their double taxation treaty network can act as a conduit to receive dividends with no or low withholding tax and subsequently pay these on to their own offshore parent without further tax or low tax in the conduit country.

Personal Holding Company

An individual can use an offshore company to hold his assets whether it be shares in a family company, bank accounts, an investment portfolio or property in perhaps more than one country. This simplifies administration of the assets and centralises them in a friendly jurisdiction which also affords confidentiality and privacy.

Planning for succession of the assets is also more efficient since it is now the offshore company's shares which form the assets of the estate. Because the assets are all together it avoids delays in administration and avoids the cost of probate and legal fees in each different country where assets are located. Instead probate need only be made in the offshore jurisdiction where the shares are located. Even this complication can be avoided if the shares in the offshore company are owned by an offshore trust.