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International tax and estate planning

Tailored solutions for businesses and individuals to help them with their international taxation and foreign investments

Opportunities for International Tax Planning 

The global economy has been expanding these last decades with increased trade and investment. This boosts mobility among high-net-worth individuals and their families; they open companies abroad and invest in foreign assets. International tax planning is becoming increasingly popular between both large corporations and small and medium-sized businesses, and even individuals.

Our Targeted Clients and Services 

Imperial & Legal experts provide professional advice on tax and investment matters in the UK and worldwide. 

Targeted clients 

  • Top managers on business trips
  • Children studying abroad
  • Families with double and multiple citizenships.

Our services 

If you are a resident in more than one country and have an overseas business, our team will analyse your situation and foreign residence to identify your tax liabilities. We offer the following support: 

  • Assessing investment opportunities from a taxation point of view;
  • Providing advice on investment opportunities based on specific countries and types of assets;
  • Preparing you and your wealth for overseas investments based on other investment and planning goals;
  • Making sure you can make an informed decision when considering if, how and where to invest your wealth.

We serve both international business owners and high-net-worth individuals wishing to reduce their tax burden and preserve their capital. 

If you are not sure whether you are a UK tax resident or not, use a special UK Tax Residence Test on our website to determine your tax status. 

Reducing tax burden: terminology

Such terms as tax minimisation, tax optimisation and tax planning are commonly used to describe ways of reducing tax. Contrary to popular opinion, the terms are not interchangeable although they have a lot in common.

Both tax minimisation, optimisation and planning are legal ways of reducing tax burden that have nothing to do with tax evasion and avoidance.

Tax minimisation 

Tax minimisation is a legal method of reducing tax payments in compliance with current national regulations and even case law. For example, a company may legally reduce its taxable income. In some countries, tax rebates are also a legal way to minimise taxes, if individuals pay for expensive medical treatment or tuition fees.

It is possible to reduce the tax burden legally not only for companies and wealthy entrepreneurs but for individuals too if they know current legislation or consult a qualified advisor. In practice, tax deductions are accessible to almost every taxpayer, but only a few of them take advantage of the opportunity.

Tax optimisation

Tax optimisation includes a more flexible approach to reducing the tax burden, based not only on current tax legislation but also on other equally effective measures.

For example, deferred tax payments do not mean that you will pay less in the end, but for some entrepreneurs, it is beneficial because they have more capital to play with and subsequently earn more.

Another tool for tax optimisation is corporate taxation which is used to redistribute tax burden or even cut down certain payments to the treasury.

Tax planning 

Tax planning, and especially international tax planning, is a set of measures aimed at reducing the taxes of an entrepreneur or a company. International tax planning includes taking advantage of nuances in legislation, government programs of different countries and competent financial management.

Imperial & Legal’s specialists reiterate that tax planning is a legal and transparent way to reduce taxes because all the necessary steps are carried out in advance, considering immigration, corporate, tax laws and intergovernmental agreements. By contrast, tax avoidance is often reactive, i.e. first a difficult tax situation occurs and then a tax resident uses illegal tools to solve it.

Tightening in international tax optimisation 

Some governments and even intergovernmental associations frown upon illegal ways of tax reduction, especially when offshore zones are used for optimisation. Information requirements have become tighter, tax returns are scrutinised more thoroughly and penalties for tax law violations are severe.

Even long-established tax havens are under pressure from outside and are losing ground: they start to tighten requirements for foreign investors and international company registration rules, disclosing lists of applicants for passport programs and sharing confidential information with other countries.

Faced with these challenges, it is difficult to overestimate the benefits of consulting international tax planning specialists. Imperial & Legal can provide you with the most updated information and qualified tax planning assistance.

Our solutions

According to our advisors, everyone contacting our company for legal assistance and consultation is always a unique case calling for a tailor-made solution. Here is an example of our tax specialists’ approach.

Tax planning for an elderly entrepreneur moving to the UK 

Case: A recently retired wealthy entrepreneur planning to move to the UK got in touch with Imperial & Legal. He wanted to be closer to his friends who settled in the early 2000s. Our client and his friends even had a UK-based joint business bringing a small but stable income. 

The entrepreneur knew some nuances of UK tax law and therefore, wanted to avoid unnecessary costs for him and his future heirs by consulting our competent advisors.

Solution: According to UK laws, all money received before a person becomes a tax resident is clean capital and is not taxed. Therefore, a plan was developed to restructure all assets to provide our client with the necessary stable income in the UK and minimise taxation of all income sources. In addition, the client’s assets were restructured to minimise potential inheritance tax liabilities.

Our advisors develop unique investment strategies that will preserve and increase your assets; they do it by:

  • Adopting a customised approach, taking into account all of the client’s circumstances and opportunities;
  • Determining the appropriate risk/return balance;
  • Having sufficient flexibility to realise all short- and long-term opportunities;
  • Allocating assets and implementing an investment strategy, as well as constantly reviewing your investment performance to rebalance your portfolio accordingly, if needed.

Our clients trust our experts because we always focus on clients’ and their family’s needs, but at the same time, we set realistic goals and assess financial limitations and possible tax liabilities for investors.

FAQ about international tax planning and investments

What is the international tax planning of a company based on?

Imperial & Legal’s specialists give three main aspects:

  1. Different tax laws in various countries. You can run your business in Malta, the UK or elsewhere and pay different corporation tax rates. We optimise company taxes when we choose the jurisdiction with the most favourable tax rate.
  2. Various types of business structures. As a rule, there is a variety of legal structures for company incorporation with different tax regimes. Tax planning includes choosing the type of company, which, under the circumstances, minimises the tax burden.
  3. Ways to take the profit out of the company. In this case, you should decide how to distribute profit generated by a company in the form of wages, dividends to owners, or otherwise. The amount of taxes depends on how you do it.

How do international treaties help to optimise taxes?

The most obvious example of an international treaty is registering a company offshore, where there are no taxes on foreign profits. You can minimise tax burden via numerous double taxation treaties, whereby the same income does not get taxed twice. The main thing is to make sure that a relevant treaty has been signed between your country of residence and the tax haven where your company is registered.

However, a fight against “aggressive tax planning”, anti-offshore laws adopted by countries, and widespread information exchange complicate the use of offshores.

Therefore, instead of offshores, companies are often registered in countries with the following conditions for tax optimisation: 

  • Low corporation tax rates for certain types of companies
  • Tax benefits for small and medium-sized businesses
  • Nuances of corporate or tax law allowing a significant reduction of the tax burden.

Why does international tax planning using companies registered abroad guarantee the preservation of capital?

If your assets are in a foreign country with an independent judiciary and a high level of political and economic stability, your capital will be safer. Your business is less at risk of incurring losses as a result of activities of government authorities, criminal structures, unscrupulous competitors, raiders and other parties interested in taking over your company.

What tax planning options are available in countries with standard taxation regimes?

Unlike offshore and low- or territorial taxation countries, jurisdictions with standard taxation attract businessmen thanks to their impeccable reputation and traditional transparency of many business processes.

Prestige, a high level of trust and operational transparency are the main factors that drive people to register a company in the UK. However, there are ways to reduce the tax burden even in countries with high tax rates:

  1. If your business is carried out in various countries, you can use the double taxation treaties mentioned above and choose the jurisdiction where corporate taxes are lower.
  2. You may use tax reliefs or deductions through government business support programs (if there are any).
  3. It is also possible to register a business structure as “tax-transparent”, for example, a limited liability partnership (LLP) with non-resident owners.

Our answer would be incomplete if we do not mention another unusual way of reducing the tax burden, which is used not by companies but by wealthy investors in Switzerland. The Swiss Confederation laws allow well-off foreigners to obtain Swiss residence in exchange for an annual lump sum tax to a canton. It is a fixed amount which does not depend on the actual income of a resident.

The amount of tax ranges from 100,000 francs and depends on the canton and the home country of a prospective resident. The amount seems significant if you consider the exchange rate of the Swiss national currency, but this tax regime is still beneficial for foreigners with an annual income of millions of dollars.

Need international tax advice?

We have been helping clients plan their estate, investment and optimise taxes worldwide. Get in touch with us to discuss your wealth plan.

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