Global investment creates layers of complexity when it comes to planning your own or your company’s taxes, not least because the tax benefits of offshore companies and trusts have been severely eroded over the years. We can help you stay compliant with complex anti-avoidance legislation and take advantage of tax-efficient options for your international trusts, companies and partnerships.
What are the issues concerning international taxation of companies?
There are several advantages to running a business through an overseas company. These include fewer reporting requirements in foreign jurisdictions and confidentiality for shareholders and directors, whose identities do not have to be disclosed.
There may also be tax benefits since broadly, an offshore company only has to pay UK tax on profits arising in the UK. For non-domiciled individuals, an overseas company can be a useful structure for keeping your business from becoming a UK tax resident, giving you greater flexibility for when you move back overseas.
Permanent UK tax residents are likely to see few benefits thanks to tough anti-avoidance legislation. If you have or are considering this type of arrangement, Collyer Bristow can help you evaluate your options and work through your risks.
What are some issues regarding the taxation of international trusts?
An offshore trust is any trust that is managed outside of the UK by trustees who are not UK tax resident. These structures are exempt from UK income tax on foreign income and can thus help you avoid a UK income tax liability.
However, the tax rules for offshore trusts are very complicated. While there are general rules that apply to all international trusts, each trust will have its own tax assessment. HMRC will look very closely at the type of trust and the residence status of the settlor, their spouse, and the beneficiaries of the trust.
Our specialist tax solicitors can help you stay compliant with regulations and ensure that the trust does not pay more tax than it has to. We can help you minimise UK income tax liabilities as well capital gains tax and inheritance tax charges on assets moving in and out of the trust.