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Holding, ¿What is?

Holding, ¿What is?

A holding company is a group of companies formed around a company that controls all or most of its shares and therefore dominates the business. It is a structure and a management model, i.e., an economic organization made up of different corporations. The companies that make up the holding company may be engaged in various economic or industrial activities, and although they have legal personalities, they do not have decision-making power.

/ Better objetives

By introducing centralized methods and systems, the holding company can bring many benefits for the management of the organization, but 

also some disadvantages, mostly linked to the difference of opinions.
/ Benefits
  • It conveys a solid and professional image to customers and suppliers.

  • Simplifies intra-company coordination of all activities.

  • Improves accounting and performance indexes, providing greater visibility on how the business is evolving and which actions have had better results.

  • Reduces economic risk, providing stability without abandoning its important objective and optimizing expense management.
  • Offsets the losses of one of the group companies with the profits of others during the same fiscal year, allowing a deferral of payment to the tax authorities, which means greater liquidity for the most disadvantaged company in the group.

  • It benefits all members with tax deductions in Corporate Income Tax and, as long as specific requirements are met, it also helps reduce Inheritance and Gift Tax and Wealth Tax.
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