Scotland

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Scotland

GENERAL INFORMATION ABOUT JURISDICTION

Scotland apperas to be an autonomous state in The United Kingdom of Great Britain and Northern Ireland, and also Scotland is an important jurisdiction of international tax law planning.

ADVANTAGES OF REGISTRATION OF THE OFFSHORE IN SCOTLAND:

- Scotland is not mention edinany black lists of any country, including Ukraine.

- Though Scotland is not apure offshore zone, this jurisdiction manages to combine English prestige and its own advantages like no obligation for companies to prepare and submit financial accountant report and to pay taxes under certain conditions.

- Taxes are not paid in the country where the company is registered.

So registration a company in Scotland seemstobea competetive gain unlike companies incorporated in England (English LLP companies).

LEGAL REGULATION

Scotland's businesses are governed by British law: the Companies Act 2006 and the Limited Partnership Act 1907.

THE PROCEDURE OF STOTTISH PARTNERSHIP REGISTRATION

Types of companies

It is possible to incorporate a Partnership with Limited Liability (LP) in Scotland. Alongside, it is obligatory to put the words LP right into the name of the company.  It is possible to insert following words into the company’s name like «bank», «insurance», «trust» only if you have relevant licenses for performing such kind of activities.

PARTNERSHIPS WITH LIMITED LIABILITY (LP):

  • Minimum statutory capital – not established.
  • Founders’ requirements – at least 2 partners (individuals or legal entities). There is no resident requirement. There should be compulsory one general partner at minimum that takes responsibility for the company’s debts and one limited partner that takes responsibility only in scope of this partner’s share.
  • Director may be represented by the general partner or by the manager, the latter is appointed by the general partner.
  • Secretary – not required.
  • Public information: information about partners. Since July 2017, Scottish LPs are required to submit data of persons with significant control (PSC - person with significant control) to the open Company House Registry.
  • Scotland LP being not a UK resident is obliged to submit annual nil tax return.
  • LP in Scotland is not subject to annual financial accounting.
  • The Partnership’s registered address should be in Scotland.

Acquiring a Scottish LP Company you get a legal entity which can possess assets and immovable property, be part of the agreements, can borrow money etc.

TAXING

If the LP’s partners are not the UK’s residents, do not do any business on the territory in the UK and do not receive any income on the territory of UK, than the LP partnership does not pay UK taxes. If the partners are residents of the UK, then taxes should be paid according to the tax scale of the UK.

When incorporating the Scottish LP, this legal entity is not considered as the separate subject of the tax system. Partners of LP pay taxes according to the received Partnership’s income which was received according to their interest, and bearing in mind the tax rate of the certain Partner’s residence and its ratio of income of the LP Partnership.

So the correct corporative structure where partners of the LP are not the UK residents, though are residents of other countries, then such LP will be free from paying taxes according to the UK Law. In order to save the maximum of the LP partners’ income, it is advised to appoint offshore partners from the low tax jurisdictions.

CURRENCY CONTROL

Not applicable.

DOUBLE TAX AVOIDANCE AGREEMENTS

As the Scottish LP does not pay UK taxes – LP companies are not subject to the power of UK’s Double tax Agreements. Not with standing such legal feature, it is popular to incorporate a Scottish LP and such type of companies are widely used in international intermediary trade.  

FEATURES

Please, be aware that very often you can find such a thing as «Offshore Scotland». In fact, Scotland has never been a pure offshore jurisdiction. It is a country with a preferential tax treatment, which can become your tax-exempt jurisdiction under certain conditions (you are not a resident of the UK, you do not carry out business and do not receive income on its territory). Under these conditions, the partnerships are exempt from paying British taxes. And the right corporate structure of the company (when partners are residents of tax-exempt offshore zones) enables the partnership to have the «offshore status» and gives you the opportunity to enjoy all tax benefits.

«Offshore Scotland» is a good choice of a high-status jurisdiction with the possibility of tax-free and report-free operation of business abroad. It’s a huge advantage if you are going to open an account in a foreign bank due to the fact that a growing number of foreign banks refuse to work with offshore companies and to open accounts for them.

If you are planning to open a company in Scotland, please contact our lawyers for advice:

+38 (044) 383-48-88

+38 (044) 383-28-88

We will help you buy a company in Scotland or any other jurisdiction of your choice.