Lee Byers Asks Can You Avoid Tax With an Offshore Bank Account?
Lee Byers Asks Can You Avoid Tax With an Offshore Bank Account
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I'm going to let you in to a little secret. At Lee Byers, as you know, we help people with their financial enquiries every day. We have a dedicated team of offshore experts on hand to assist with everything from an offshore bank account to QROPS, from health and life insurance to complete wealth managementbut ever so occasionally we get an email through directly asking us whether an offshore bank account can be used as a tax shelter.
These enquiries tend to be from those in high tax countries or expats about to move to a high tax country and of course the answer is pretty much always a straight no' because you know that these people are seeking to avoid or evade their legitimate tax liability.
However, there is a case for using an offshore bank account when you are an expat and depending on your circumstances, such as where you live, work, earn and remit money, you may very well be able to legitimately reduce your taxation liability. And a tool in your armoury will be your offshore bank account. Confused? Don't be, allow us to explain
Know Your Rights and Your Responsibilities
In this wonderful world of ours we are always being reminded of the fact that ignorance is not an excuse when it comes to any legal matter. So, when it comes to the payment of taxation due on money earned for example, ignorance is not an excuse you have to find out what you owe and pay it. Fact.
What is not made so much of is the additional fact that you have absolutely no reason to overpay your tax, declare that which need not be declared, or go out of your way to bring wealth onshore and into a tax net as an expat when you are not legally obliged to do so.
So, not only is ignorance not an excuse when it comes to your responsibilities but we at Lee Byers state that ignorance is also not an excuse when it comes to knowing your personal rights and what you can and cannot do to legitimately reduce your tax burden.
Who Can Legally Reduce Their Tax Bill Offshore?
You have to take personal advice about your financial position because whilst you might read and identify with the following, there may be some element of your position that negates the following for you. In other words, the following is a general overview of who may be able to reduce their tax burden by going offshore it does not constitute advice, and therefore you can only use it as information to guide you towards seeking personal and professional advice about your individual position.
If you are an expatriate moving from a high tax country to become non-tax resident and therefore you will not liable for tax in your old home nation, you may find that there are ways you can use the offshore world to enhance your wealth status in part through the legitimate reduction or offsetting of tax. You may find you move to a country where tax is only paid on wealth you remit to that nationso, keeping your assets offshore can mean they are shielded from tax.
Alternatively you may be moving to a country such as Belize or Malaysia under their retirement' programmes and discover that as long as you don't earn an income in the country, all of your wealth is tax free so you can have everything offshore or onshore and still legitimately avoid tax.
You could discover that if you place your wealth in a certain offshore investment product you could offset the payment of any tax due on your wealth's enhancement and advancement until the termination of that investment product's term. This is fantastic for those whose tax position may change for the better in that interim period.
Big businesses also use a web of interlinked offshore companies and bank accounts to shift their profit centres around so that they can offset profit and loss and ensure any final profit is realised in a bank account in a jurisdiction where they are not liable for high rates of taxthis method is really only suitable for big business, and there is quite a lot to be said for the legitimacy of such behaviour or otherwise - anyway!
So, Can You Escape Tax With an Offshore Bank Account?
No, you cannot hide money from the taxman in an offshore bank account. But yes, an offshore bank account can be part of an expatriate's offshore wealth management plan that altogether enhances the expat's financial position and makes the most of any legitimate methods available to them for saving tax!
To find out more and to get personalised advice and information, please get in touch with us today. We will put you in touch with the best adviser to help you from our pool of offshore experts.
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