Case Study:
How Janusz will avoid the Non Dom Tax Charge
The situation:
Janusz is a businessman and entrepreneur who came to the UK from the Czech Republic in 2004 and had already accumulated wealth in his home country. Following the changes to the UK tax regime which came into effect in 2008 for nondomiciles, he came to Oaklands Wealth Management to see how he could stop his wealth being eroded in the future.
The solution:
Following meetings in London we discussed the possible options after assessing Janusz’s personal attitude to risk. We advised re-investing his funds from the Czech Republic into an Offshore Bond holding a balanced portfolio of cash deposits, collective equity funds and corporate bond funds.
Janusz is now safe in the knowledge that in 2011 he will escape both the £30,000 government tax charge and UK tax liability.
Furthermore, now that Janusz is running his own business in the UK, we were also able to help with advice on pension arrangements, paid tax efficiently through
his company. |
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Non Domicile
Non Domicile Tax Advice
UK Non Domiciles - Escape The £30,000 Levy!
There are ways you can use offshore investments to avoid paying the £30,000 levy introduced in 2008.
What is the Current Issue for Non Doms?
Before the Finance Act 2008, Non Domiciled residents did not pay tax on their overseas income or gains as long as it was not bought into Britain.
Since the Finance Act 2008, Non Doms who have been resident in the UK for more than 7 years have no longer been able to benefit from this perk unless they pay a £30,000 annual levy.
If this applies to you, offshore bonds are an effective way to avoid this.
The Benefits of an Offshore Bond
Saving the £30,000 Annual Levy
As Offshore Bonds are classed as a non-income producing asset they are not assessed for the £30,000 levy in relation to offshore income.
Virtually Tax-Free Growth
Investment in an Offshore Bond grows free of year-on-year Income Tax and Capital Gains Tax, though small amounts of withholding tax may be payable on certain investment funds.
Tax Efficient Yearly Withdrawals
Each year withdrawals of up to 5% of the original investment can be taken from most offshore bonds without an immediate tax liability and is particularly beneficial for higher rate taxpayers. The 5% withdrawal can be taken each year for 20 years, or accumulated over a number of years.
What You Can Do Next
If you wish to find out more about the issues around Non Domicile we have prepared a SPECIAL SERIES on NON DOMICILE that we can send you FREE of charge. Just register your details below and you shall receive the first part very soon.
Helen Blackburn BA (Hons)
Managing Director
Send me my FREE Non Domicile Series
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