Bank secrecy (or bank privacy) is a legal requirement in most tax havens and this prohibits banks providing authorities (foreign governments and their tax departments) personal and account information about their customers. Bank secrecy was codified in Switzerland by the 1934 Federal Act on Banks and Savings Banks. This Act also created the famous ‘numbered…
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The tax incentives for Early Stage Venture Capital Limited Partnerships (ESVCLP) apply from 1st July 2016 and provides partners with a 10% non-refundable tax offset on capital invested during the year. The maximum fund size for ESVCLPs is $200m and ESVCLPs are no longer required to divest a company when its value exceeds $250m. Entities…
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The top 7 illegal employee tax saving strategies in Australia are: Employees or contractors not declaring cash wages. Not reporting capital gains on the sale of shares or property. Not declaring interest, dividend or rental income. Not declaring overseas income like wages, capital gains, rent, etc. Claiming private expenditure as a work deduction…
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The Cook Islands claims to be the first country to have enacted an explicit asset protection law (in 1989 with its International Trusts Act). The asset-protection trust is a trust that splits the beneficial enjoyment of trust assets from their legal ownership. The beneficiaries of a trust are the beneficial owners of equitable interests in…
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The Low-Income Superannuation Tax Offset ((LISTO) allows individuals with an adjusted taxable income of $37,000 or less to receive an effective refund of the tax paid on their concessional contributions, up to a cap of $445. The offset cuts out completely at a taxable income of $66,667.
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There is nothing wrong with being a novice tax planner (it’s actually very exciting taking the challenge and starting the journey to learn something new). But the most important thing we need to do is just follow Plato’s advice and make a start. Over time we will build our skills and hopefully move to at…
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Locating a holding company in a tax haven can be used to bring together investors from various countries who are investing in businesses that are in turn operating in numerous countries. This creates a single point through which all business operations and investors can be co-ordinated without the imposition of significant compliance costs or additional…
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This strategy involves a discretionary trust making pre-tax trust distributions to a tax-exempt beneficiary. If the beneficiary is tax exempt (a not-for-profit organization or church) then there will be no income tax paid on that income by the beneficiary. The beneficiary does not need to be able to receive tax deductible donations (i.e. be a…
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In the novice stage, a person follows rules as given, without context, with no sense of responsibility beyond following the rules exactly. Competence develops when the individual develops organisational principles to quickly access the particular rules that are relevant to the specific task at hand; hence, competence is characterised by active decision making in choosing…
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Without doubt, the dominant legal reason to use tax havens is to save tax. Many taxpayers, especially multi-national corporations, can legally save tax by structuring their affairs to use a tax haven. Apple, for example, has saved US$86 billion in US taxes by funnelling revenue through its tax haven entities and leaving the profits overseas.…
Read More »"You’d be stupid not to try to cut your tax bill and those that don’t are stupid in business"
- Bono: U2