Based on the information discussed, here are two solid options which I consider the best for establishing a holding company in Europe:
- UK Holding Company
If you're not a UK tax resident and are comfortable with the UK's status outside the EU, setting up a UK holding entity is top. Key benefits include:
- 0% taxation on any ownership under the ltd company over 5%
- 0% withholding tax on dividends paid to non-residents, allowing for tax-free repatriation of profits.
- A straightforward process for distributing dividends or dissolving the company to access its assets.
- Low maintenance costs and a strong reputation as a jurisdiction for holding companies.
- Luxembourg Société de Gestion de Patrimoine Familial (SPF)
Designed specifically for private wealth management (e.g., holding activities), the Luxembourg SPF offers:
- 0.25% tax with a maximum of €125K. Over that, it's 0%.
- It cannot have commercial / trading activity and is restricted to only holding/managing assets. This is, in practice, very flexible, as certain management fees can qualify as "managing assets" and, therefore, inclusive.
Both structures are designed to minimize scrutiny from tax authorities (p.e.
Spain ETVE/holding is not ideal despite 1.25% taxation) and take advantage of the robust double tax treaties available in the UK and Luxembourg. Each has unique advantages depending on your specific circumstances and requirements.
I hope this provides some useful guidance!