Who Can Benefit from Offshore Bonds?
A bond gives certain people the flexibility of investing now for tax-free returns in the future. However, an offshore bond ‘wrapper’ is ideal for people who are planning to move abroad, those who are expecting to be non-taxpayers or those who expect to be basic rate taxpayers at the time of cashing in the fund.
Fund-holders have the flexibility to change their arrangements in line with their changing circumstances with this form of investment bond. For instance, it may be necessary to switch from making cash deposits to collective investments. Such a change will incur no initial costs when an offshore bond ‘wrapper’ is in place. The fund-holder will also incur no initial charges for accessing the available funds held within the bond.
No Income Tax Liabilities
The British government regards offshore investment bonds as assets that do not deliver an income, so they are not usually liable for income tax.
A Wide Range of Products are Available
The offshore bond ‘wrapper’ gives individuals the chance to include several different types of investment within one portfolio. This minimises risk by limiting exposure to any one investment opportunity in particular. Fund-holders have the option of making cash deposits or collective investments.
Provides a Steady, Tax-Free Income
An offshore bond incurs no immediate liabilities in terms of UK income tax, and fund-holders are allowed to withdraw up to 5% of the original investment amount every year. Offshore investments are ideal for those who are moving – or who are about to move – abroad, as they give people the chance to control how much tax they pay, when they pay it and who they pay it to. A financial adviser will study an individual’s personal finances and future plans, and a specific investment portfolio will be designed within an offshore bond ‘wrapper’. This type of investment’s flexibility means fund-holders can adjust their contributions according to their changing circumstances, so they are able to enjoy the returns on their investment without needlessly losing some of their retirement income to tax.
Company’s Profile: Whichoffshore provide professional expatriate information on many financial topics in order to help British expatriate make the most of their expat life abroad. For more information, please visit – http://www.whichoffshore.com/ This was a guest post by whichoffshore.