amount of money
Contribution to property has become repayable. Will he become an alternative to a loan in a group of companies
Making a choice in favor of one or another reason for tax-free cash flow in a group of companies, the possibility of their return without taxes is often a key criterion. If we add to this the efficiency of processing, we get the expected result – loans are the most popular tool for the flow of money.
The closest alternative to a loan – a contribution to property without increasing the authorized capital – has long been virtually irretrievable. The return on investments was possible only in the form of dividends or upon sale of a share in the business, with appropriate taxation.
Since the beginning of 2019, the situation has changed – the participant has the opportunity to return previously made contributions to the property of a subsidiary without additional taxation. Continue reading
LLC is the most common form of legal entities in Russia. This is a kind of intermediate type of participation in entrepreneurial activity between the association of only capital (joint-stock companies) and the association of personal, primarily labor, participation (for example, a production cooperative). It is this feature that determines the rules for exclusion of a person from the membership of LLC, the presence of a number of special rules aimed at protecting his interests.
For example, without the consent of all participants, a company cannot be reorganized (for comparison, in joint-stock companies, in order to make such a decision, 75% of the votes of those participating in the meeting of shareholders must be collected). This protects the interests of all participants, primarily personal participation, taking into account personal opinions, regardless of their share in the authorized capital. Continue reading
The risks posed by the lack of proper regulation of relations between business owners have been devoted to more than one issue of our newsletter. As well as the methods of legal consolidation of partners ’agreements, ranging from“ direct appointment ”instruments – shareholder agreements and agreements on the exercise of participants’ rights, to the features of certain legal forms (for example, business partnerships) and intricacies in relations between the parent and subsidiary companies. But the further the development of Russian medium-sized business and the legal literacy of its owners goes, the more questions there are.
At the same time, more and more tasks from the category of “how to regulate relations between partners at the start.” As we decided one of them – we show on an example from practice. Continue reading