What substance can include
- Local director or manager involvement.
- Office, registered address or operating presence.
- Local accounting and records.
- Board minutes and decision evidence.
- Employees, contractors or local spend where relevant.
When it matters most
- Holding companies.
- IP companies.
- Finance or treasury companies.
- High-profit low-staff businesses.
- Bank account opening and due diligence.
Weak substance signs
- No local decisions.
- No contracts or invoices.
- No proof of business.
- Owners manage everything from another country.
- Only a registered agent and nothing else.
Practical rule
- The more tax advantage a structure claims, the more proof it usually needs.
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