Structuring a holding company is one of the most challenging tasks for tax advisors and businesses, because there are so many factors to consider in terms of taxation, residence and optimisation. The simple fact that a holding regime exists in a given country will not make the whole structure work. Here are the key aspects to consider when choosing a holding jurisdiction:

Income tax. In favourable holding jurisdictions, income derived from qualifying participations (i.e. dividends and capital gains) will ideally be fully exempt from corporate income tax. In many holding countries, full tax exemption is possible under specific participation exemption rules established by local legislation.
Outbound distribution of dividends. Dividends paid by a holding company to its parent company may be exempt from withholding tax under certain conditions. The final withholding tax rate may vary, depending on the residence status of the beneficial owner.
Double taxation treaties and the EC Parent-Subsidiary Directive. Tax treaties are aimed at reducing withholding tax rates on inbound and outbound dividends. Therefore, the most appropriate holding jurisdiction depends on the respective locations of the parent company and the subsidiary.
Tax residence status. Achieving tax residence status can be crucial for utilising the benefits of a holding company. Obtaining a tax residence certificate can be challenging but may be possible under certain conditions, such as having a resident director, a local rented office, local employees and others. Other obligations, like annual financial accounts, statutory accounts and tax returns, must be complied with at all times.
Substance. Very often there are substance requirements, with some countries stipulating a certain amount of substance in the holding jurisdiction before tax benefits can be obtained (so-called anti-abuse legislation).

The minimum monthly wage in Chile is 328 USD. Chile has a government debt of 226.1% of the country's Gross Domestic Product (GDP), as assessed in 2013. With regard to consumer prices, the inflation rate in Chile is 1.7%. The currency of Chile is Chilean peso. The plural form of the word Chilean peso is pesos. The symbol used for this currency is $, and it is abbreviated as CLP. The Chilean peso is divided into centavo; there are 100 in one peso. Each year, consumers spend around $177,422 million. The ratio of consumer spending to GDP in Chile is 0.06%, and the ratio of consumer spending to the world consumer market is 41%. The corporate tax in Chile is set at 22.5%. Personal income tax ranges from 0% to 40%, depending on your specific situation and income level. VAT in Chile is 19%. In 2013, Chile received 125.5 million USD in foreign aid.In 2014, the foreign aid amounted to 163.9 USD.

Gross Domestic Product
The total Gross Domestic Product (GDP) assessed as Purchasing Power Parity (PPP) in Chile is $410,853 billion. The Gross Domestic Product (GDP) assessed as Purchasing Power Parity (PPP) per capita in Chile was last recorded at $22,577,803. PPP in Chile is considered to be very good when compared to other countries. Very good PPP indicates that citizens in this country find it easy to purchase local goods. Local goods can include food, shleter, clothing, health care, personal care, essential furnishings, transportation and communication, laundry, and various types of insurance. Countries with very good PPP are safe locations for investments. The total Gross Domestic Product (GDP) in Chile is 277,043 billion. Based on this statistic, Chile is considered to have a large economy. Countries with large economies support a wide variety of industries and businesses, providing ample opportunities for investment. Large economies support a substantial financial sector, making it easy to organize investments and financial transactions. It should be very easy to find good opportunities for investment in Chile. The Gross Domestic Product (GDP) per capita in Chile was last recorded at $15,224,478. The average citizen in Chile has very high wealth. Countries with very high wealth per capita have an extended life expectancy and very high standard of living. Highly skilled workers can be found in many industries, and labor is very expensive in these countries. Countries with very high wealth offer opportunities for safe investments, as they are often supported by a diverse and thriving financial sector. GDP Annual Growth Rate in Chile averaged 2% in 2014. According to this percentage, Chile is currently experiencing modest growth. Countries that are experiencing modest growth offer safe opportunities for investment; their expanding economy indicates that businesses, jobs, and income will expand accordingly.

Lithuania has a corporate tax rate of 15%, which is one of the lowest in the European Union. Companies that operate under VAT have to pay tax on purchases at 21%. Certain services, like those related to some domestic passenger transport, books (excluding e-books), newspapers and periodicals, hotel accommodation, district heating, and others, benefit from a 9% VAT rate.

The Republic of Cyprus or simply Cyprus is an island country in the eastern Mediterranean Sea and the third largest and most populous island in the Mediterranean Sea. Cyprus is north of Egypt, south of Turkey, west of Lebanon and Syria, north-west of Israel and finally – south-east of Greece.

As Cyprus is a former British colony, around 80% of the population is relatively fluent in English. Similarly, the legal system is also developed on the basis of the common law practiced in England. Cyprus is a free market economy which offers various opportunities including efficient tax planning for international companies. With top-notch accounting and legal services and an excellent geographic location, Cyprus is a great place to do business. The country is considered a leader among tax planning jurisdictions, so incorporating a company in Cyprus is an ideal way to protect your business. During the past decade, Cyprus' role in international tax planning has grown dramatically. As an EU member state, Cyprus has earned a reputation as a legitimate and reliable jurisdiction with over 40 double taxation treaties and some of the lowest taxes in the EU.

Advantages of acquiring a Cyprus shelf company
Once you have decided that Cyprus is the right jurisdiction for your company, you can either incorporate a new company or purchase a ready-made company. Ready companies are legal entities that were formed some time ago and have been “sitting on the shelf” ever since for investors to buy and run that business. Based on this comparison, ready-made companies are also referred to as shelf companies. Buying a shelf company has several advantages.

The main goal of a shelf company is to provide the investor with a company with a clean history, as older companies are often perceived as more trustworthy, reputable and reliable than newly formed companies. Acquiring a shelf company is also faster compared to the process of forming a new company. This turns out to be a great advantage for many entrepreneurs who need to start trading as soon as possible.

Acquisition of a Cyprus shelf company
Buying a shelf company in Cyprus is usually a simple and quick process. Companies specializing in the sale of shelf companies offer full service. This means that along with the company itself, they can also provide a full set of corporate documents, company secretary, registered office, nominee shareholders and directors, company bank account with internet bank and debit cards, VAT number and even support for the first year of operation possibly.

Usually the process of a shelf company acquisition is completely organized by the service provider and it only takes 24 hours before you can start trading. The process of buying a ready-made company can differ between different service providers, but usually 4 steps are required to buy a ready-made company:

Step 1. You select a company from a list provided on your service provider's website;

Step 2. Your service provider will send you a bill that needs to be paid;

Step 3. Submit a signed Know Your Client form, a copy of your passport and a utility bill in your name;

Step 4. The service provider prepares your chosen company and all the required paperwork including: all the company incorporation documents, an open share transfer agreement in your name, a Deed of Trust prepared for you by the shareholders and nominee directors and some other informative ones Documents . All documents will be sent to your address on the same day. Since the company is already registered and has a VAT number, you can start trading the same day.

It is important that you carefully consider which service provider is best suited to your needs, as the packages of services offered differ, as do prices and reliability. It is up to you to conduct full due diligence so that you can trust your service provider. For example, while some service providers offer shelf companies with a bank account already open, others offer the option of opening one after the company has been acquired, which will usually take several days. It is up to you to do a full due diligence for you to be able to trust your service provider. For example, while some service providers offer shelf companies with an already opened bank account, others offer an opportunity to open it only after the acquisition of the company, which will typically take several days.

Typically, shelf companies have a legal structure of a Private Limited Liability Company, which is also the most popular type of structure among newly incorporated companies. The popularity of this structure can be explained by the limited responsibility shareholders have in regards to the company’s debt and other liabilities. Also, the minimum capital is smaller in comparison to Public Limited Liability Companies – 5,000 EUR.

Offshore Shelf Company
In case you are not planning to do business in Cyprus, you may benefit from even more beneficial tax structure. As an international entity you are allowed to conduct any legal business activity, make investments, trade portfolios of bonds and stocks as well as buy and sell real estate outside of Cyprus and not pay corporate tax at all.