International tax planning with the use of off-shore jurisdictions: a new era
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Over the last 10-15 years, application of the off-shore jurisdictions was one of the methods of international tax planning. Off-shore companies were used due to their advantages in many spheres of activity, in particular – their bigger opportunities for tax planning (tax payment economizing), which the off-shore jurisdictions used to supply. For example, the profits from deals were accumulated in an off-shore company exempt from taxes or subject to beneficial tax rates, while the information on the company’s founders and directors remained inaccessible for the Russian tax authorities. Russian business also actively used the off-shore companies as “money purses” for storing the profits obtained in the form of dividends from the activities of the enterprises located in Russia and owned by the off-shore companies.
When the Federal Law No. 376-FZ dated 24.11.2014 (hereinafter — the Law No. 376-FZ) entered into force, reality changed for the Russian business. Will the habitual ways of tax planning with the use of off-shore jurisdictions be usable or will new ones be needed? What should the owners and beneficiaries of the existing off-shore companies expect?
Rankings and Partners
