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To
the uninitiated, the world of tax havens and offshore
companies conjures up an exciting, if not slightly illicit,
cocktail of millionaires, exotic locations, scantily clad
females and hunky guys. That this is rarely the case, hardly
seems to matter. What does matter, however, is that it is
possible for the owners of businesses to arrange their
personal and business affairs to genuinely and legitimately
mitigate their worldwide tax position.
As you can see from the quotes below,
it has long been an established legal right for a person to
arrange their affairs in a way which subjects them to the
least possible taxation.
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"Every man is entitled if he can to
arrange his affairs so that the tax attaching under
the appropriate Acts is less than it otherwise would
be.
"If he succeeds in ordering them as to
achieve that result then however unappreciative the
Commissioners of the Inland Revenue or his fellow
taxpayers may be of his ingenuity he cannot be
compelled to pay an increased tax."
Lord Tomlin in the case of The
Commissioners of the Inland Revenue v Duke of
Westminster, 1936 |
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"Every tax ought to be levied at the
time - or in the manner - in which it is most likely
to be convenient for the contributor to pay it."
Adam Smith, The Wealth of Nations,
1776 |
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"The legal right of the taxpayer to
decrease the amount of what otherwise would be his
taxes, or altogether avoid them, by means which the
law permits, cannot be doubted."
Mr Justice Sutherland
in the Supreme Court. |
Tax Havens exist to
fill a need of their own - they need money. Many tax havens
are located in countries which are poor in natural resources
or which have no manufacturing industries on which the
income and expenditure of the country can be based.
Countries have to raise operating revenues from somewhere,
and with low income there is not much to be gained in high
taxation. In order to attract income and investment many
such countries have become "offshore financial centres"
offering businesses and investors a legal way to reduce the
burden of taxation, and to protect assets. Most of them also
offer anonymity - should this be desired.
THE MAIN BENEFITS OF GOING OFFSHORE
1. There is No Capital Gains Tax
(Ideal for trading in stocks and shares)
2. There is No Inheritance Tax
(Your family enjoys all of your wealth)
3. Income Tax is Effectively
Removed!
4. Money Invested Offshore Grows
Without Deduction of Tax. (?5,000 invested at 10%
offshore becomes ?38,000+ over 20 years compared with only
?26,000 in the UK - even in the same bank!)
5. Confidentiality. Meaning
that the ultimate ownership of companies and assets is
anonymous - no one will know you own the company unless
you tell them.
Many factors will affect the most
suitable offshore arrangement for your own individual
circumstances - where you live, where you work, where you
were born, which citizenship you have, and where you want to
retire.
Consideration will have to be given
to what you hope to achieve - a reduction of taxes by legal
means, planning for inheritance and estate taxes, protection
of your assets, or confidentiality.
In addition will your offshore
structure simply hold assets, make investments or actively
trade? What are the assets you seek to protect and where are
they located? What anti-avoidance legislation exists in your
own country? These are all matters which have to be
considered carefully before taking steps to move your
trading or your assets offshore.
This website contains a wealth of
information and advice to help you. Use the navigation bar
on the left to begin your voyage offshore. Feel free to
browse and download information from our
Information Centre or contact us by telephone or by
E-mail to discuss your requirements. We will guide and
advise you on the best structure and tax haven for your
circumstances. If required we are able to undertake full tax
planning and to this end can arrange for written opinions or
for one of our qualified consultants to meet with clients at
their convenience either in the UK or overseas. Such
meetings and advice may be chargeable at an agreed rate. |
