What Is A Holding Company and Where Is The Best Location?
Posted on May 3, 2017
We might often hear the term “holding company”, yet may not completely understand what its function is, and if you are uncertain yourself, a holding company is one that holds stock in other companies. The holding company would not have a product or a service, and can be regarded as a base for controlling stock investments in other businesses.
This is one form of a holding company, which would typically be a limited company or partnership, and owns enough stock in another company to control its management and policies. There are many advantages to controlling a business via a holding company, one being that if the company were to go bankrupt, then the holding company would not be liable to the debtors. Although it will have lost in a capital investment, should the controlled company go under, at least the holding company is not liable for their subsidiary’s losses.
A holding company would be setup to manage a series of property investments, or many other types of assets, including stocks and shares, patents, and even trademarks. Often, a small group of private investors will decide to create a holding company, through which they can effectively manage their investments, and providing the holding company is established in a country with favourable tax rates, it is a very attractive proposition for the investor. Many opt for a Swiss holding company as this offers very attractive concessions and low tax rates, and there are online companies that will organise everything on your behalf, and they even provide virtual office services, should you require it.
Creating your holding company in the very heart of the financial capital of Europe offers many benefits, and with the stable financial environment and attractive tax concessions, you would be hard pressed to find a better location for a holding company. From an image perspective, having a Swiss holding company is very prestigious, and with a wide range of services on offer, the company that arranges the holding company registration would guide you through the process.
Switzerland comprises of districts, or Cantons, and each operates independently regarding taxation and general administration, which is why you need the advice of an expert, who can tell you which Canton is the best location for your new company. If you are thinking about setting up your own holding company, an online search will put you in touch with the right organisation that can give you the right advice, and they can also facilitate the company registration and assist with opening bank accounts and fund transfers.
The Internet is an essential thing for modern business and your new offices in Switzerland will need to be fully prepared for a broadband connection, and with the help of the experts, all your business needs can be provided by one company.
There are many advantages to setting up a holding company, and providing you seek out professional advice, your new business venture should be successful.