Investor Presentaiton
Illustrative TMK Structure Diagram
SPC 1
100%
Actual arrangements for holding of
specified (ordinary) shares in the
TMK will depend upon lender
requirements. However, in essence
investors should enjoy 100% control
and economic returns from TMK
Less than
50% of
preferred
equity
Asset
Manager
Asset
Management
Investor
TMK
100%
A less "vanilla" form of structuring for the onshore shareholding element of
the TMK involves investing in those shares pursuant to a TK arrangement.
This can materially reduce the overall effective tax rate, although the
robustness of such structuring approach can be impacted by the specific
factual circumstances in each case.
I Debt
(Limited
I
I pursuant to
SPC 2
! "thin cap"
I
and
I
I
earnings
I
More than!
Japan
50% of
preferred i
Branch
equity
Ownership
Real estate / Trust beneficial interest
stripping
I I rules)
Bond
Financing
KPMG
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This debt is optional, but it is generally a
beneficial arrangement by helping to
mitigate tax at Japan branch level.
Bondholder
(QII)
Offshore
Japan
A Japanese corporation can be
used in place of a branch; a
branch is typically more efficient
from a Japanese withholding tax
perspective, but this is ultimately a
question of fact.
Document Classification: KPMG Confidential
5
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