Management & substance

Material matters are becoming more difficult in Europe and around the world for tax reasons, so some customers may prefer to have more physical presence instead of performing virtual office services. One of the possible strategies for increasing substance is the establishment of a functional management office. Substantial problems usually arise when local tax authorities request confirmation that the company's business is conducted in the country in which the company is incorporated: they want to see the real existence of a commercial activity in the specified jurisdiction.

A company with substance is a company abroad that resembles a classic "offshore" company, but has a so-called "substance" (presence), the business, i.e. an administrative office. It is more like a real local business, but has ties to the onshore business.

For more and more entrepreneurs, the economic substance of their company is becoming an overwhelming task. The creation of economic substance has become a great danger as tax authorities, banks and state institutions delve deeper into the two main questions: 'Where is the actual place of management and control of the company?' and 'Who is the beneficial owner?'

Confidus Solutions can offer the substance office in a variety of jurisdictions worldwide, including numerous well-known offshore jurisdictions. However, given the complexity and efficiency of content delivery, we strongly recommend that you consider the following jurisdictions as your first choice: Latvia, Cyprus, Lithuania and Hungary - as we can offer more advanced services in these states than a pure virtual office, as well as more solid ones Reasons to believe that the company operates in the particular location. The question of the actual place of management and control of the company is lately not only for tax authorities, but also for business partners, suppliers, banks and opponents due to the implementation of the interstate tax laws and the rapid development of international trade and online trade of become of vital importance.

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