Incorporations in the Slovakia

At present companies registered in Slovakia are a very convenient alternative to a standard holding jurisdictions such as Cyprus, Malta, the Netherlands or Luxembourg.

Costs of registration and maintenance of the Slovak company are significantly lower than companies registered in Malta, the Netherlands or Luxembourg.

Slovak companies have strict advantages in comparison with other jurisdictions of holding companies:

  • No income tax on dividends paid by a Slovak company to its shareholders from the countries with which Slovakia has a treaty for the avoidance of double taxation (e.g. Cyprus). In other cases the withholding tax is charged at a rate of 35%;
  • Exemption from income tax of dividends received from subsidiaries located in countries which Slovakia is a treaty for the avoidance of double taxation with (e.g. the Netherlands). In other cases, dividends are taxed at a rate of 35%;
  • Withholding tax when paying interest on the loan or the royalty is 19%

When planning to use the Slovak company it is important to bear in mind that Slovak companies are not allowed to distribute of interim dividends, dividends may only be distributed at the end of the financial year after annual financial statement are prepared and approved.

Compared with the jurisdictions mentioned above Slovakia also has a number of other advantages, in particular:

  • Excellent reputation of a country that never was part of the "black" lists of the EU and CIS countries;
  • Easy incorporation procedure;
  • Not high corporate income tax rate of 21% (2017);
  • Attractive costs of incorporation and administration services;
  • Possibility of issuing a power of attorney to manage the company, including general one.