Why should you choose to invest offshore?
Over the past 15-20 years, UK investors have become far more adept at managing their own investments. The introduction of tax-efficient vehicles such as ISAs and the emergence of off-setting accounts are just two of the ways in which the UK investment market has become more accessible to the man or woman on the street.
UK investments alone, however, don’t always provide the returns that some investors are looking for, and many of the products are subject to tax at high rates. It’s no surprise then that many investors choose to invest a proportion of their wealth in offshore investment products.
So, what are the benefits of choosing to invest offshore?
Returns
The wide variety of offshore investments means that there are more opportunities to gain excellent returns. For investors who have medium-term goals and need to provide for school or university fees or early retirement, offshore investing can provide the returns they need.
Tax
There are several tax benefits to investing offshore, particularly if you are living and working overseas. Depending on the type of investment, the length of the investment and how you choose to access your money when you need it, you can gain significant tax advantages through offshore investments, including income tax, capital gains tax and inheritance tax.
Access to more opportunities
By their nature, offshore investments give you access to more opportunities than traditional UK-based funds. The growing number of countries offering offshore investment means that you have a wider choice of products, and this allows you to tailor your portfolio more accurately and more successfully. Your returns could be greater and you can spread your risk across a wide range of investments.
Showing posts with label offshore. Show all posts
Showing posts with label offshore. Show all posts
Wednesday, 18 April 2012
Independent financial advice – Offshore funds
Take independent financial advice to find out whether you should be investing in an offshore fund
Offshore explained
Independent financial advice may show that you should consider investing in an offshore fund. As well as collective investment schemes set up in the UK, many are set up in other jurisdictions. In UK tax terms these are referred to as "offshore funds". The UK has no taxing rights over such entities, although UK resident investors are chargeable in respect of income from these schemes and gains on disposal of holdings in them. Where the scheme makes distributions each year, the income is generally chargeable as income from overseas possessions.
Tax treatment
When an investor disposes of shares or units in an offshore fund, the tax treatment depends on whether the fund had ‘distributing’ status throughout the period of the investor's ownership of the shares or units. If it had, the normal chargeable gains rules apply on disposal. If the fund did not have ‘distributing’ status for the entire period of ownership of those share or units, special rules apply to treat any gain on disposal of those shares or units as income arising in the year of disposal. In broad terms, a fund has distributing status for a year if it distributes all its income to investors. Take independent financial advice for more details.
Where should I invest?
There are many places around the world offering excellent offshore opportunities. Here we put the spotlight on a few of them.
Guernsey
Independent financial advice might point you in the direction of Guernsey. Its position as a centre of excellence for the provision of offshore financial services is evidenced by the wide range of institutions conducting business on the island and the quality of the Guernsey professional practices upon whose expertise they can call. English speaking, with a centuries-old tradition of political stability and good governance, Guernsey is in the same time zone as London and has frequent air links both to London and to other United Kingdom airports.
Monaco
The Principality of Monaco in the south of France has especially favourable tax laws for companies and corporations. As such it is often used as a base for corporate wealth management Monaco
The Isle of Man
Situated off the coast of North West England, the Isle of Man exists under its own jurisdiction and has particular tax advantages. Independent financial advice reports that the Isle of Man operates a taxation strategy working towards a zero rate for companies, a policy of low taxation for individuals, and no capital transfer, wealth, inheritance tax or death duties.
British Virgin Islands
The BVI's financial strategy has been to diversify from its historical role as a domicile for International Business Companies (IBCs) and into trusts, captive insurance, and funds. Independent financial advice reports that the BVI has been very successful in this diversification.
Offshore explained
Independent financial advice may show that you should consider investing in an offshore fund. As well as collective investment schemes set up in the UK, many are set up in other jurisdictions. In UK tax terms these are referred to as "offshore funds". The UK has no taxing rights over such entities, although UK resident investors are chargeable in respect of income from these schemes and gains on disposal of holdings in them. Where the scheme makes distributions each year, the income is generally chargeable as income from overseas possessions.
Tax treatment
When an investor disposes of shares or units in an offshore fund, the tax treatment depends on whether the fund had ‘distributing’ status throughout the period of the investor's ownership of the shares or units. If it had, the normal chargeable gains rules apply on disposal. If the fund did not have ‘distributing’ status for the entire period of ownership of those share or units, special rules apply to treat any gain on disposal of those shares or units as income arising in the year of disposal. In broad terms, a fund has distributing status for a year if it distributes all its income to investors. Take independent financial advice for more details.
Where should I invest?
There are many places around the world offering excellent offshore opportunities. Here we put the spotlight on a few of them.
Guernsey
Independent financial advice might point you in the direction of Guernsey. Its position as a centre of excellence for the provision of offshore financial services is evidenced by the wide range of institutions conducting business on the island and the quality of the Guernsey professional practices upon whose expertise they can call. English speaking, with a centuries-old tradition of political stability and good governance, Guernsey is in the same time zone as London and has frequent air links both to London and to other United Kingdom airports.
Monaco
The Principality of Monaco in the south of France has especially favourable tax laws for companies and corporations. As such it is often used as a base for corporate wealth management Monaco
The Isle of Man
Situated off the coast of North West England, the Isle of Man exists under its own jurisdiction and has particular tax advantages. Independent financial advice reports that the Isle of Man operates a taxation strategy working towards a zero rate for companies, a policy of low taxation for individuals, and no capital transfer, wealth, inheritance tax or death duties.
British Virgin Islands
The BVI's financial strategy has been to diversify from its historical role as a domicile for International Business Companies (IBCs) and into trusts, captive insurance, and funds. Independent financial advice reports that the BVI has been very successful in this diversification.
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