Doing Global Business For Discussion Purposes Only  by: Harry Holmquist, CPA
Commentary Tax Tools Tax&Biz Links Work Order Client Portal	Certain countries are preferred business locations for  persons who set up holding companies or facilities offshore.  This writing will attempt to address some tax planning coordinating point involving for example, Ireland, Switzerland, Netherlands, Cyprus, and others.  An Irish offshore ("nonresident") company needs two stockholders and two directors, who cannot be Irish or UK residents.  The Memorandum of Association can be very broad with regard  to potential activities.  Such a company can establish bank accounts anywhere.  Approximately the same can be said for all the above mentioned states.You may need only one European back office, but be careful what activities occur in that office.  No contract signings should happen there - only solicitation, marketing and accounting, paying invoices, etc.  Having a back office in cities such as Dublin, London and Prague could be a potential tax problem if considered a permanent establishment with high-margin revenue source income – that is, if contract signings, management billable time, etc. are involved.		On the other hand a Swiss office, has probably no exposure to taxation on such activities as they are considered "nonresident" unless tied to Swiss business. US multinationals and others, working together with related or non-related-but-dependent third-country vendors, are able to take advantage of Swiss holding corporations to support operations in Europe or other locations which involve high-value-added activities (i.e, ABB, Oracle, the pharmaceutical houses, etc.)  Lower-margin product distributors are probably less interested in Switzerland.
			"Caveat Emptor."
			The Russia/Swiss treaty includes a 12-month exception/exclusion on contract supervision activities.  So, the Swiss company pays back hard currency bonuses to the Russian company principals with no withholding at source.  For Russian purposes, the two companies will generally avoid using the same names and other  "red flags".  continued

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