Tax optimization is often the main driver in determining the fund structure; this holds true for private equity and real estate funds as well as debt funds and venture capital initiatives.
When setting up an investment fund, the tax position of the various stakeholders will need to be taken into account; the investors, the fund management team and the asset class the fund will invest in. Carefully weighing the interests of the various stakeholders will eventually result in the most efficient fund structure. Such a structure should cater for the fund making investments, holding the investments for a certain period, dispose of investments and distributing return to investors, all in a tax efficient way. In addition, specific VAT aspects of fund structures need to be carefully monitored.
VanLoman advises on the right fund structure and will assist in obtaining advance clearance from the Dutch tax authorities on the tax consequences of the fund structure if desired. For example in relation to the application and scope of the lucrative interest rules with respect to the (carried) interest owned by management. As for international fund structures VanLoman regularly obtains tax rulings with the Dutch tax authorities.
After having identified the most tax efficient fund structure, it is important that the fund documentation (PPM, Prospectus, Information Memorandum, Investment Agreement, etc.) are aligned with the proposed structure. In close cooperation with fund lawyers and civil law notaries, VanLoman assists with the preparation of the fund documents. During the fund raising process, VanLoman can advise investors in setting up an investment structure for their investment in the fund.
VanLoman also advises (domestic and international) investors that consider to invest in Dutch funds. Depending on the tax position of the investor, we advise on how the investment can be made in the most tax efficient way.
Do you now have more questions than answers? Do not hesitate to call me on +31 (0)6 5121 9669.
