The EU Savings Directive
recently came into force and affects all EU residents.
You will either face disclosure of your investment to your home
country or a with-holding tax starting at 15% eventually increasing to
35%.
The countries, which have elected to go down the with-holding tax
route are Belgium, Luxembourg, Austria, Switzerland, Jersey, Guernsey, the Isle of
Man.
Legitimate tax planning structures, such as an offshore life
assurance bond, remain at the forefront of careful tax planning and
are outside the effect of the EU savings
directive.
Additionally, in most EU countries, acceptable investment within an
offshore life assurance bond enjoy the following benefits:
- The interest can roll up gross with no tax levied by the insurer
- The policyholder has no annual tax liability
- The benefits are, in certain circumstances, treated favourably,
with attractive tax relief available (i.e. UK residents)
In a low interest rate environment, the deferral of income tax until
a time when benefits will be taxed at a lower rate can mean the
difference between the investment value keeping up with inflation or
not. >>
