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GMSshipping.com
1 May 2008
closed limited partnership
1-Closed CV
Participating
in a Dutch private limited partnership is an investment in a Dutch
company. This means that every year a tax declaration (income tax or
corporation tax) has to be made for the gained profit in the
Netherlands.
Price per participation:
€ 5.000
Minimum number of
participation:
2x5000
20 June 2008
Open limited partenership
2- Open CV
We
discourage participants to invest in a Dutch public limited
partnership, because 25% tax on dividends will be deducted from the
distributed dividends. If the Netherlands and the state of residence
made a treaty for avoidance of double taxation, the tax on dividends
will be reduced to 15% in most cases. When the taxpayer is not liable
to the Dutch income or corporate tax for another source of income the
tax on dividends can not be deducted and will not be returned.
Therefore the expected output of the project is at least 15% smaller.
Price per participation: € 5.000
Minimum number of
participation: 2x 5000
Financial returns
Another important
factor affecting profit is the sale price of the ship. This depends on
various factors including supply and demand of that particular type of
ship at the time of sale, and the physical condition of the ship.
expected.
Most CVs yield an average one-time return. This is calculated annually
by dividing the sum of the annual profits by the number of years.
Favourable
interest rates
Participants will continue to receive
high interest (4.5%) returns during the construction period should
building
work take longer than expected.
Returns in
January and June
Advance payments are planned for January
of each year, and the final payment in July the rendement expected can
be reach to 18%.
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Investor
Participation in a Dutch private limited
What is a CV
participation?
The CV is an abbreviation of the Dutch for a Limited
Partnership. This is
one of the legal forms used for a company. A CV comprises one or more
general partners, and one or more limited partners, also called silent
partners. The general partners manage the business and also assume any
legal debts and obligations.The
limited partners contribute cash to finance the business.
Participants and interested parties will be dealing
primarily with this
partnership, as it is this company that is responsible for recruiting
participants.
They are also
entitled to some of the company’s capital, in other words to share in
the profits of the company (proportional to their investment). Limited
partners are also entitled to vote on important company decisions. The
type of decision this applies to is often described in the CV contract.
Limited partners are not liable for any losses that might occur. The
maximum risk run by a limited partner is therefore the amount of money
they have invested. If you participate in a shipping CV, you become a
limited partner in a shipping company. This usually involves the
purchase, exploitation and sale of one or more ships.
Ther are two kind of
Participation:
-Closed CV (closed
limited partnership)
-Open CV (Open
limited partenership)
Taxes:
The large proportion of the invested capital is regained in the
first year through tax. There is also discontinuation relief, in which
tax is not paid on a significant amount of the capital when the CV
ceases to exist. This used to make “old” shipping CVs a low-risk
investment, and ensured that they still made a good profit. However,
these tax benefits were abolished in January 2001. What does remain is
the tonnage scheme, or tonnage tax. This tax measure dates from 1996
and was introduced in order to stimulate the Dutch shipping business.
Shipping CVs founded after January 1st 2001 welcome this measure with
open arms.
Discontinuation:
How can you discontinue your participation in a shipping CV? The
most favourable option is to remain in the CV until it ends, in other
words to wait until the ship is sold and the CV is dissolved. The sale
often yields good financial returns for the limited partners. Ships are
usually sold after around 10 years, but some CVs are put on the market
sooner. A sale might also be arranged sooner if a good offer is made
unexpectedly.
Another option if you wish to
discontinue is to sell your interests,
although with a closed CV this does require permission from all the
remaining partners. Selling interests is easier in an open CV. It is
often sufficient just to inform the managing partner of your decision.
For more information contact us:
info@gmsshipping.com
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