EU Gateway: Holding Company Jurisdictional Overview

14/11/23

This EU Gateway publication with the title “Business and Tax Features of Selected Holding Company Jurisdictions” outlines key tax and business features in five European jurisdictions for establishing holding companies. More specifically, the five European jurisdictions were put side to side in terms of

General Key Tax Features,
Pillar Two Key Features, and
Business Features

The provided information is sourced from PwC Worldwide Tax Summaries and PwC’s Pillar Two Country Tracker, as well as from publicly available information and surveys.

Take a look here at our EU Gateway publication.

What does it mean for you?

Creating a holding company involves evaluating various factors. The overall tax landscape, including key features like Pillar Two and business considerations, significantly influences the choice of the ideal jurisdiction. We advise against solely relying on a low corporate income tax rate as the primary factor. Instead, prioritize a favorable Income Inclusion Rule (IIR) location for Pillar Two to streamline compliance and reduce administrative complexities, minimizing the risk of scrutiny in other jurisdictions.

It is essential to note that the information included in our publication is succinct, but if you require further clarification or detailed insights, our dedicated EU Gateway team can connect you with the local PwC office. They will provide you with tailored information, assisting you in making well-informed decisions based on your specific business needs and goals. Please feel free to reach out to us for additional information.

PwC the Netherlands as your EU Gateway

PwC Netherlands, supported by the robust Knowledge Centre and the ITS/EUDTG network of EU colleagues, endeavors to offer coordinated assistance to non-EU clients in navigating the intricate EU tax and legal landscape.Furthermore, PwC Netherlands assumes a proactive role in apprising clients of significant EU tax law and EU27 domestic developments through the monthly EU Gateway newsletter, thereby establishing itself as the primary point of contact for non-EU clients and colleagues within the EU.

The publication

Part 1: General Key Tax Features

We have identified 15 General Key Tax Features considerations that must be carefully evaluated when establishing a company with a holding function. These considerations provide an overview of the tax system applicable in a chosen jurisdiction. Please note that exceptions may apply to the information provided.

Amongst others: substance requirements, CFC rules, withholding taxes, taxes on capital contributions and double tax treaty network.

Part 2: Pillar Two Key Features

Under the OECD Inclusive Framework, over 140 countries have agreed to implement a Two-pillar solution to tackle challenges related to the digital economy. Pillar Two introduces a global minimum Effective Tax Rate (ETR) where multinational groups with consolidated revenue over EUR 750m will be subject to a minimum ETR of 15% on income earned in low-tax jurisdictions.

Amongst others: covered taxes, safe harbor rules and compliance.

Part 3: Business Features

In addition to the General Key Tax and Pillar Two Features, we have compiled a list of Business Environment Features specific to each selected jurisdiction.

Amongst others: cost of living, global innovation index and investment environment.