Indeed, the relationship between Trusts, both onshore and offshore, Taxation, Asset Protection and Wealth Preservation has brought about a demand for information which was difficult to obtain only a decade ago. And this is all quite legal. The super-rich have been doing it for decades. Most major companies and banks, globally, have offshore operations.
But, now these arrangements are available to anyone wishing to enjoy the following benefits:
Save vast sums in taxes
Pass wealth to future generations free of tax
Enhance financial privacy away from networked databases
Shield against harassment and vengeful lawsuits
Minimise inflation and currency risks
Protect property against government confiscation
Limit personal liability
Avoid currency, capital and exchange controls
Minimise economic and political risk
Transfer ownership of almost any asset anonymously
Reduce costs of property transactions
Use trust as a money-raising vehicle
Avoid probate on death
Preserve wealth with financial, investment and pension planning
Richard Branson saved many millions in tax when he sold his Virgin Record Company by using offshore arrangements. Before Virgin went public, Branson took the step which saved him tens of millions in tax by transferring ownership of many of his shares in the Company to Offshore Trusts of which he and his family are beneficiaries. When the Company went public, and when his music business was sold later, in a transaction worth over £560 million, the bulk of the capital gain was free of tax. There was not, could not, and will not, be any dispute over the legality of the tax avoidance inherent in the transaction. This kind of trust arrangement is expressly allowed under British tax law. And the same is true for most Western countries.
A man owns, solely or jointly, a portfolio of investments. These are usually properties, but could be anything of a capital nature. The properties may be mortgaged. Using legal strategies, successfully implemented over decades, the portfolio can be moved, under statutory protection, into a tax-free, trust-based environment.
The portfolio investments can be sold free of any tax on the capital gain. Tax-efficient rental strategies remain available. The investments and their sale proceeds fall outside estate/death/inheritance taxes.
This arrangement uses statutory reliefs. It does not even touch on “tax avoidance”. It has full disclosure to tax authorities. It can be set up in conjunction with existing professional advisers. It uses independent professional trustees. The perfect arrangement.
Tax avoidance is fine. Tax evasion is illegal, no matter where you reside.
A U.S. Supreme Court Judge stated: “The tax-payer has a right to so arrange his affairs as to make his tax as low as possible.” And a French Chancellor: “The art of taxation consists in so plucking the goose as to obtain the largest amount of feathers with the smallest possible amount of hissing.”
Punitive taxes are among the major obstacles in accumulating wealth today. In high-tax countries, which includes most of the Western world, the government will try to take 50% or more of your income while your alive and working.
After you have gone, it will try to take at least 50% of what you have left, in estate/inheritance/death tax.
As privacy is eroded, most Western countries are following the United States’ example. Frivolous, indiscriminate, costly litigation abounds, with lawsuits appearing everywhere and for everything. Well-informed lawyers know exactly what your assets amount to, and can ruthlessly pursue their clients’ claims to them, unless action is taken to protect them. Offshore arrangements will do this.
But it’s not just lawyers who can gather information on you. Private investigators, with access to advanced technology, can glean the deepest personal and business knowledge, without anyone knowing. According to a UK television documentary, the UK Inland Revenue uses undercover vehicles to eavesdrop on suspected tax fraudsters. Offshore arrangements can help avoid this.
Our lives are finite, but corporations can live forever. This means that you could use an offshore entity as a wealth preservation and estate planning vehicle to provide a source of income to uncounted generations of your family. Unless you protect your wealth and your estate, your heirs could lose more than half of it. Then, of course, the government becomes your biggest “heir”.
By using a simple offshore trust, rather than a corporate one, in the event of the death of the settlor, the winding-up of the estate can be accomplished simply without delay.
If you truly wish maximum privacy for your business and financial affairs, combined with the most efficient wealth preservation planning, you should do something without delay, no matter where in the world you reside.
Duncan Watson, Expatriate Financial Bureau, has advised on offshore strategies since 1979. For further information on the advantages of trusts please go to:
http://www.protectallassets.com
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