We are very strong in the field of international tax advice.
By ‘international tax advice’ we mean advice on tax matters that concerns countries other than those in which we have offices.
Some areas on which we commonly provide advice are as follows.
Beneficial ownership under treaties and EU directives
BEPS
Brexit-related issues
Controlled foreign company (CFC) matters
Determination of the profits attributable to a permanent establishment (PE)
Dual residency issues – companies and individuals
Employee taxation – expats, income from abroad
EU – EU case law, the Parent-Subsidiary Directive, Interest & Royalties Directive, etc
Existence – or not – of a PE
International tax planning – companies and individuals
Inheritance and gift tax planning
Planning for foreign investment income
Reducing foreign withholding taxes
Residency and management and control
Residency under tax treaties
Re-structuring – moving to better tax structures
Structuring investments abroad
Tax treaty application
Tax treaty interpretation
Taxation of foreign real estate
Thin capitalisation rules
Transfer of residency
Transfer pricing
Treatment of foreign exchange gains and losses
VAT – advice on international VAT issues
VAT – administration in an international context, including registrations around the world
Withholding tax issues
Withholding tax refunds
Why Sheltons for international tax?
We are a small firm, yet have highly developed international tax consulting skills, rare even among the very largest firms
We have a good knowledge of the corporate tax law in many countries and the approach by the tax authorities there to tax treaties
We have many years’ experience in the field of international tax
Most of the international tax work we do is at the request of accounting and law firms around the world – we are used to working with ‘referrers’
We are very familiar with tax treaties – including the practical aspects
Our history – and a little about Ned Shelton and Ivan Zammit
Sheltons has advised on international tax since the day we commenced business as an independent firm, in 1994. Our expertise is used in the creation and delivery of our training courses on international tax which we run throughout the world. The very creation and running of those courses enhances our international tax knowledge.
Our principal advisers in this area are Ned Shelton and Ivan Zammit. Ned has worked in this area for more than 25 years. Ivan Zammit worked with Ned Shelton for some seven years, then in 2013 commenced a full-time Masters in international law degree at Leiden University (the Netherlands). After completion he spent four months as a teaching assistant there. Today Ivan heads up our Malta office and spends considerable time on international tax projects.
Examples of clients cases
- Example 1A Swiss tax specialist asked us to provide advice for a Taiwanese manufacturing client
The Taiwanese company had various patents and trademarks (IP) and wanted to licence these to unrelated companies in seven countries
Our task was to identify the best jurisdiction to own the IP and to advise on how best to licence from there to each of the seven source countries
We provided ‘Phase 1’ advice; it included several alternatives
After discussing that with his client the Swiss adviser asked us to quote for ‘Phase 2’ advice – focusing on two main alternatives for the ownership of the IP – and providing more detailed advice on the licensing
We quoted for the Phase 2 advice on the condition that our advice would be subject to approval by appropriate specialists in the countries concerned. - Example 2A Polish law firm approached us regarding their client’s (a Polish business owner) Cypriot structure
The main (but not only) purpose of the Cypriot company was to own certain assets
The client’s Polish adviser decided Cyprus was no longer appropriate
We were introduced directly to the client
Our task was to find the ‘next best’ structure
The client set out several conditions regarding the jurisdictions – including the fact that they should not be ‘offshore’. - Example 3A European high net worth individual contacted us to advise on the personal tax consequences of moving to five different countries, considering his various investments
We provided a quote for ‘Phase 1’ advice, to highlight positive and negative features of a number of countries, relevant to his situation
Based on that the client asked us to focus on two countries
We then provided Phase 2 advice, being a comprehensive advice on the remaining two countries, including instructing local advisers with relevant competence to double check our advice on their countries’ taxation
Our fee included the disbursements to the two local advisers. - Example 4An Indian law firm approached us for our view on the interpretation of the term ‘liable to tax’ in the context of Article 4 of the tax treaty between India and Singapore.
- Example 5A Mexican law firm asked us to advise whether a Luxembourg company’s vessels in Mexican waters (Mexican Gulf) servicing local oil rigs constituted a permanent establishment for Mexican tax purposes
Comment 1: Mexico follows the OECD Model commentary very closely
Comment 2: The choice of Sheltons by the Mexican law firm related to some extent to the fact that Ned Shelton has conducted courses on international tax, including treaty interpretation, for the Mexican tax office (SAT) in Mexico City.