Create a Holding Company in France or Abroad?
😉 Learn more 👉🏼 https://linktr.ee/quarma_and_co
📤 Contact me - [email protected]
💻 Website - https://quarma.net
_______ SOCIAL MEDIA _______
YouTube - / @quentincellerier-quarma
Linkedin - / quentin-cellerier
Instagram - / quentin_cellerier
____________________________________
I - The Myth of the Holding Company
The ultimate solution for paying less tax
→ A lethal weapon of taxation or an intellectual scam? A holding company is often a structure:
whose corporate purpose is to acquire interests in and manage other companies
it is, in reality, a company like any other
and there are two main types of regimes
1/ The Parent-Subsidiary Regime
Conditions
the companies must be subject to corporate tax
the holding company holds at least 5% of each subsidiary company
Taxation
each subsidiary company pays its corporate tax
the holding company is taxed on 5% of dividends received
2/ The Tax Consolidation Regime
Conditions
the companies must be subject to corporate tax
the holding company holds at least 95% of each subsidiary company
Taxation
the holding company is taxed on 1% of dividends received
the possibility of offsetting losses from loss-making subsidiaries
total corporate tax paid within the holding company
So, with a holding company, you will pay:
tax on the subsidiaries (or on the holding company in the event of tax consolidation)
repay a small portion of corporate taxes for dividend payments
your dividends no matter what, either for your investee companies or for your holding company, if you want to withdraw some personal money
And for those who are going to tell us about the magic of tax consolidation. It's a good thing you don't pay taxes on a loss-making company 😅
What don't we ever tell you?
When you withdraw money personally, you'll have the same taxes as any other company:
social security contributions
income tax
flat tax
etc.
→ In short, no tax optimization in short!
II - When to use a French Holding Company?
France can sometimes be an excellent strategic choice.
It has (in my opinion) major advantages:
Moving money between your companies
Preparing for donations/inheritance
Smoothing out the results in the event of tax consolidation if you have loss-making companies
Access to loans and bank credit
For social security: health, retirement, unemployment
For local facilities: expenses, charges, and depreciation are deductible in France
It's a banking paradise: borrowing facilities and leverage are accessible like nowhere else
Its holding company system is advantageous: for moving money and reinvesting (in real estate, for example?)
But also in the event of legal obligations: simply when you have no choice but to have an address for your business there
How can you optimize your situation?
Instead, we'll use a foreign company (less taxed)
to generate cash and transfer it back to your French holding company.
This is called a producing or issuing company.
The holding company retains its role of circulating cash, allowing it to reinvest in another company, project, real estate (SCI), etc.
The producing or issuing company: the one that generates cash; it's the one whose tax benefits we need to optimize.
PS: Nothing prevents you from directly acquiring shares in another company, another project, an SCI, etc., with your producing company.
III - When to Use an International Holding Company?
Contrary to what many people think,
For me, using a foreign company as a holding company
will primarily serve to optimize your compensation
to withdraw money with lower taxes, regardless of your situation
With one of the strategies I use? → We can divide our taxes by 2 or even 3:
the corporate income tax is only 15% or 3%
there is no tax on capital gains: neither on sales nor on investments (ETFs, bonds, cryptocurrencies, stocks, etc.)
0% tax on dividends at source
etc.
But most importantly? * Your dividends, as a French tax resident, are only taxed at 5% instead of 30%
This allows you to increase your compensation
without increasing your tax
or your income tax
PS: Nothing prevents you from moving abroad, to pay even less tax on your dividends
Creating a company abroad can open incredible doors for:
International image: and for a global business
Tax optimization, of course: reduced taxes on profits, dividends, or even capital gains
Greater financial flexibility: investments, capital, the ability to shift expenses internationally
etc.
It is often more suited to new lifestyles: expats, digital nomads, online businesses, etc.