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Old 26.03.2021, 11:19
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Tax on headquarter or branch company

I am in process of opening an SÓrl in Switzerland and
a branch of it in Germany. In terms of Taxes, i was confused which company should stay as parent and other as branch to avoid excessive taxes.
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Old 26.03.2021, 13:19
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Re: Tax on headquarter or branch company

Well Switzerland does have a reputation for having a relatively low corporate tax (Tc) rate... But a quick google search would have answered that instantly.


Do note that in order to maintain HQ status in Switzerland, you need to ensure that the main business related activities and decisions are also made in Switzerland. It will mean directors, main trading activities and contracts with 3rd parties will have to be mainly concluded within the Swiss entity.



Then on top to make sure to benefit from the interesting Swiss Tc you will also need to create transfer pricing contracts (basis arm's length pricing, normally cost + 5%) with your EU entities to ensure your costs are carried over to the Swiss entity in question. I can ramble on for a while here, since it was my work for many years..



BUT, better just to speak with a tax consultant the likes of KPMG / Deloitte etc. They are the specialist in tax cough *evasion* cough avoidance.
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Old 27.03.2021, 09:33
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Re: Tax on headquarter or branch company

Not a tax professional but as one who has learnt by experience, I would offer one other bit of advice; make sure you plan your model out fully BEFORE you start setting anything up.

Just getting started with an idea to "optimise, refine and adjust later" could get you trapped into something that achieves an undesired outcome. eg driving either taxes or operating costs to the wrong location.

A complex topic so I second the advice to get professional help before you start.
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Old 27.03.2021, 10:28
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Re: Tax on headquarter or branch company

Yes, do not attempt to do this by yourself and present your plans to the tax office when you think you have figured it out. In order to be credible you MUST have the backing of one of the big tax consulting firms, if you want to be taken serious.
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