1

Nexia World Tax MeetingVienna, May 31, 2008

European Holding Company Analysisby Chris Leenders,

International Tax Partner at Koenen en Co,Member of Nexia The Netherlands/

Nexia International

2

European Holding Company Analysis

• Countries covered: 20

• Updates as per January 1, 2008

• Issues covered: 17

3

European Holding Company Analysis

Countries covered:

Austria, Belgium, Cyprus, Czech Republic,Denmark, Finland, France, Germany, Greece,Hungary, Ireland, Luxembourg, Malta, The Netherlands, Portugal, Romania, Spain, Sweden, Switzerland, United Kingdom

4

European Holding Company Analysis

Editorial aspects

• Word document• PDF file on website• Update annually• Countries not covered?

5

European Holding Company AnalysisIssues

1. Treatment of dividend income

• Participation exemption: 18 countries (full or 95%)

• Taxable with credit: 2 countries (Greece and UK)

6

European Holding Company Analysis2. Minimum participation

• At least 10% : 12 (some 0% in case of unlisted shares)

• At least 5% : 4 (France, Ireland, The Netherlands, Spain)

• Other/0% : 4 (Cyprus, UK, Hungary, Portugal)

7

European Holding Company Analysis3. Treatment of capital gains

• Participation exemption: 15 (some 95%)• Taxable with credit: 2 (Greece, UK)• Taxable: 3 (Hungary, Ireland (in case not

EU/no DTA), Romania)

8

European Holding Company Analysis4. Minimum participation

• In accordance with requirements mentioned in § 2

9

European Holding Company Analysis5. Minimum “ownership” period

requirements

• 1 year : 10• None : 7 (Cyprus, Germany, Hungary,

Netherlands, Malta, Sweden, UK)

• 2 years: 3 (Greece, France, Romania)

10

European Holding Company Analysis

6. Active business test on underlying participation

• Yes : 10• No : 10 (Czech Republic, Romania, France,

Greece, Germany, Ireland, Luxembourg, Malta, Portugal, Sweden)

11

European Holding Company Analysis7. Subject to tax-test on underlying

participation

• Yes : 13• No : 7 (Greece, Netherlands (if active

business), Ireland, Luxembourg (if EU sub), Malta (if EU sub), Portugal,

Switzerland)

12

European Holding Company Analysis

8. Rates CIT, DWHT, other taxes

• To various to give any comment

13

European Holding Company Analysis

11. Withholding tax on liquidation

• Yes : 12• No : 8 (Cyprus, Denmark, Greece,

Ireland, Luxembourg, Malta, Spain (in some cases), UK)

14

European Holding Company Analysis12. Interest deductibility;

Debt/equity ratio’s• Interest deductible:

Yes: 16 / No 4 (Cyprus, Denmark, Portugal, Romania)

• Debt/equity ratio’s: Yes: 10 / No 6 (Austria, Finland,

Greece, Ireland, Malta, Sweden)

15

European Holding Company Analysis13. CFC and/or anti-abuse regulations?• CFC:

Yes: 11 / No: 9 (Austria, Czech Republic, Greece, Ireland, Luxembourg, Malta,

Netherlands, Romania, Switzerland)• Anti-abuse:

Yes: 6 (France, Germany, Netherlands, Portugal, Spain, Switzerland) / No: 14

16

European Holding Company Analysis14. Advance Tax Rulings

• Yes: 16

• No: 3 (France, Greece, Ireland)

17

European Holding Company Analysis16. Double tax treaty network • Does the holding company receive

treaty protection?

Yes: 18 / No: 2 (Cyprus, Greece)• Are anti treaty shopping / beneficial

ownerships tests included?Yes: 15 / No: 5 (Czech Republic, Ireland, Greece, Hungary, Romania (?)

18

European Holding Company Analysis

17. Exchange control restrictions?

• None

19

European Holding Company Analysis

QUESTIONS ?

THANK YOU !