Alternative assets have become one of the business segments that investment firms are promoting the most. The change in regulations on SICAVs, the vehicles that millionaires traditionally used to channel their assets and optimize their tax bill, led numerous investors to look for formulas that would provide them with the same effect.
But the constitution and management of a variable capital investment company is not the same as the structuring of a venture capital company and the portfolio of underlying assets it has, due to the legal and tax implications that its joint requirements may entail. And in this sense, Creand is clear: Poorly structured alternative vehicles have been launched that in a few years will cause problems. Problems that are going to come in the form of massive inspections, both by the CNMV and by the Tax Agency, warns Luis Bilbao, general director of Creand Asset Management.
These alternative vehicles to which the Andorran bank refers are venture capital companies (SCR) belonging to a family group, which in many cases are not aware not only of the cost necessary to maintain said company but of the most appropriate legal structure. to fit together all the pieces of business and family heritage.
“The disappearance of SICAVs has pushed families to set up SCRs thinking about tax credits. But they spend 90% of the time talking to the team of tax advisors and only then talk to the investment team and this can lead to problems in the future due to the illiquidity of these vehicles and the time frames with which they operate,” says Sergio Muñoz, head of alternative assets at Creand AM.
The expert emphasizes that Investors make the mistake of equating the format of a venture capital company with that of a traditional vehicle or a SICAV.and compare the cost in the same way, which can lead to making mistakes when structuring the alternative vehicle in an attempt to reduce commissions. If in a SICAV the average cost was 0.30%, in an SCR that percentage can be doubled at least, depending on the complexity.
But it’s not just the cost. Depending on the shell adopted by said company or the underlying assets it has, the tax implications may be different, depending on whether the Treasury considers that the SCR complies with the regulations to be considered as such or whether certain requirements have not been met. , in something as basic, for example, as the amount contributed for its constitution. And it will not be the same whether the company has a sole administrator or a board of directors, if it is self-managed or delegates management to third parties, if it has participations in direct investments or if it collects dividends from a company registered in Luxembourg.
“It is necessary to have advice because what may suit a client from a tax point of view may not be so from the point of view of investments and the cost of the vehicle structure,” insists Muñoz.
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