Tax Optimization Strategies: Tax Reduction and Increased Customer Satisfaction for a British Software Company
Initial Situation
An English software company has so far exclusively served the Brazilian market from England.
Invoices for Brazilian B2B customers were issued by an English company.
Service provided
In two weeks, a comprehensive tax analysis
was prepared and discussed with the client.
The benefits of issuing invoices through a
Brazilian entity were clearly demonstrated.
Eventually, the ILM Group proposed two possible solutions for the English company, in order to mitigate the tax burden: (1) the establishment of a small Brazilian subsidiary that would be fully managed by the ILM Group, or (2) the execution of a license with ILM Group, allowing ILM Group to act as a Brazilian Distributor of the English software company.
ADVANTAGE
The analysis served as the basis for management’s decision-making in executing a license agreement with
the ILM Group. The English company’s Brazilian customers were satisfied because they finally received local invoices, which are not subject to additional taxation and can be paid without additional administrative fees.
Net sales generated through the license agreement were passed on by ILM Group to the English software company on a quarterly basis, with guaranteed tax efficiency.
