Going international and trying to choose the appropriate operational structure? There are many considerations involved in this decision, and knowing the complexities of tax laws can certainly benefit you.
With BPM's breadth of experience in global restructuring, your business can benefit from the capabilities of our firm. We can help you achieve major reductions in your overall tax liabilities by taking in your overall situation and identifying a tax-efficient structure suited for you. We also assist with enhancing cash-saving deferral opportunities, avoiding hidden pitfalls such as sub-part F provisions, eliminating double taxation, and enabling tax-efficient repatriation of foreign earnings.
Members of our team have extensive expertise in:
- Global IP planning
US-based companies that own intangible property related to their businesses. Establishing an entity to hold intangible property in such a jurisdiction can give rise to significant tax advantages if properly structured. One benefit to a US company of holding intangible property through a non-US affiliate is the potential to lower the rate of taxation on income earned with respect to such intangible property. For example, royalty payments made by a US company to its non-US affiliate for the use of intangible property held by the non-US affiliate may be subject to a lower rate of tax if the jurisdiction in which the non-US affiliate is organized is a low-tax jurisdiction.
- Global supply chain planning
Companies are expanding their supply chains across the globe, targeting new markets and obtaining cost efficiencies. Comprehensive tax planning across a company’s supply chain structure can identify opportunities to achieve global tax cost savings. At BPM, we have the broad and diverse experience to assist companies with the assessment, design, and implementation of changes to their supply chain with tax and business objectives in mind.
- Investment structure planning
International investors are cognizant of the investment benefits of structuring with efficient tax planning in mind. We help clients achieve this goal by studying, advising and implementing tax-efficient structures to minimize worldwide effective tax rates. Tax planning involves knowledge of the U.S. anti-deferral tax rules (such as the controlled foreign corporation (CFC) and passive foreign investment company (PFIC) regimes) as well as transfer pricing and other tax planning concepts. Our expertise in these areas help clients focus on the business and the investments, knowing that we identify and plan given international tax developments that may affect our clients’ structures and investments.
- US tax planning for foreign corporations
Foreign-based companies with investments in the US as well as those considering US investments are faced with the complexity of US tax rules that can have significant impact not only on US investments but also on the return on investment. This consideration along with the comparatively high US corporate income tax rate, have led foreign companies to look for opportunities to efficiently manage their US businesses while ensuring that their effective tax rate remains competitive.
We can assist with determining who has to pay and who doesn’t have to pay US tax based on activities conducted in the US, and with structuring your US business entity for tax efficiencies if establishing a corporate presence is consistent with your company’s cross-border tax planning strategy and commercial objectives.
- Cross-border mergers & acquisitions
In considering the tax effects of cross-border M&A transactions, it is critical to analyze the various tax rules that come into play in both the US and the target jurisdiction. Our team has the expertise to advise your company with respect to the most common structures used to efficiently finance an M&A deal from a tax perspective. We look to the critical tax considerations such as looking at the availability of asset-basis step-up structures for tax purposes and identifying valuable tax attributes in merger and acquisition targets, including net operating losses, foreign tax credits and tax holidays. Among other considerations, these issues affect the adequacy of any inherited tax provisions as well as the effect that these items might ultimately have on a purchaser's own tax provision.
We have the network to liaise with alliance firms to structure and implement tax-efficient M&A deals from both the US and non-US country’s tax perspectives. Further, our expertise allows us to offer in-depth analysis of the tax issues arising from the implementation of the most common cross-border corporate financing techniques, such as tax structuring through debt financing and hybrid instruments.
- Tax attribute study and repatriation planning
Tax attribute studies help clients determine the proper use of tax attributes such as net operating losses that are relevant in various areas such as reorganizations, acquisitions and dispositions, and can affect the tax consequences in all transactions. Our repatriation planning assistance allows companies to efficiently meet corporate objectives to redeploy cash to other countries or other regions considering local withholding taxes, foreign tax credits, or other considerations.
- Treaty analysis
Qualified residency and limitation on benefits determinations
An income tax treaty can provide certain benefits to taxpayers. However, these benefits are not available to all individuals or business entities. For example, income tax treaties have certain residency requirements for persons seeking to claim tax treaty benefits, and these persons must also meet certain other conditions intended to limit treaty benefits to certain individuals and business entities. Our team has extensive experience is this area to perform the proper analysis and determine whether taxpayers qualify for treaty benefits, and whether the US or non-US withholding taxes may be reduced or eliminated on certain payments that would otherwise be applicable. This analysis is critical for US companies conducting business or expanding outside the US, and for non-US companies investing in the US.