| Offshore funds are assets invested
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| | and investment products available to UK
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| offshore where tax advantages exist. The
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| | residents.
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| Bahamas or the Channel Islands can be
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| | The situation of each investor is
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| considered as examples. These are funds
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| | different. Offshore investors tend to
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| outside the tax system of the country
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| | have very complex criteria governing
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| where the intended investor is residing.
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| | investment selection, so in addition to
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| Offshore funds offer eligible investors
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| | standard criteria (for instance passive
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| significant tax benefits compared to many
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| | funds, low cost, no load etc) the
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| high tax jurisdictions such as United
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| | following issues must also be considered.
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| States and the European Union. However,
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| | 1. Complex international tax issues
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| where funds are repatriated to high tax
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| | typically apply. Tax considerations are
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| jurisdictions, they are usually taxed at
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| | urgently important. It is imperative that
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| normal rates as foreign arising income.
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| | a competent authority on international
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| Many of these tax haven locations are
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| | tax law be consulted before any offshore
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| considered investor friendly and are
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| | investments are made.
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| intentionally regarded as financially
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| | 2. Ensure that tax avoidance shouldn't be
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| secure.
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| | any investor's goal. The goal ought to be
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| Many offshore jurisdictions, notably the
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| | maximization of post tax wealth. It may
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| British Virgin Islands, offer a zero tax
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| | sometimes make sense, therefore, to
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| regime for investment funds, which are
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| | invest in an imperfectly tax efficient
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| domiciled there, which allows the fund to
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| | vehicle if it is better, on an after tax
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| reinvest that part of its investment
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| | basis, than any other similar vehicles
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| portfolio's gains which would otherwise
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| | available.
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| have been lost to tax.
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| | 3. Some countries largely prohibit their
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| A number of offshore jurisdictions have
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| | residents from investing in overseas
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| recently tightened the regulation of
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| | domiciled investment funds (e.g., US,
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| offshore funds.
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| | Canada).
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| Offshore funds such as overseas unit
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| | 4. Residents of some countries may have
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| trusts, open ended investment companies
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| | local investing options available which
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| and other similar collective investment
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| | might be competitive with most of the
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| schemes, have a long established position
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| | countries but are not limited to
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| of importance among the range of savings
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| | Australia, Canada, Ireland, UK, US).
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