Time Apportionment relief
Any UK tax will be reduced proportionately from time spent a non-UK resident
Additional investments are deemed to be made at the commencement of the contract (even if they are additional Lump sum investments or regular premiums made when the client is UK resident again) thereby increasing any time apportionment relief given.
No UK income or capital gains tax change on assignor.
All future UK in come taxed charged at the new owner’s tax rate (if any)
Therefore, the overall UK tax payable can be reduced if the policy is assigned as a gift to a non-tax payer, for example a child or grandchild of the assignor who is a university student or a non-working spouse/partner
Easy to assign into a trust with the insurance company concerned, for a small yearly fee.
Possible to reduce or eliminate UK inheritance Tax liabilities.
Generation planning and asset protection advantages.
Can remove requirements of probate.
Gross Roll Up
Generally, the funds in which a policy holder invests are not subject to taxes in the insurer’s jurisdiction. For example, insurers in the Isle of Man do not currently pay tax on the funds held for their policyholders.
However, investments income building up in any fund/asset may be subject to a tax deduction in the country where the income was produced.
Gladstone Morgan Ltd recommend that you seek clarity from HM Revenue & Customs on individual cases.
5% Tax Deferred withdrawals yearly
Yearly withdrawals of 5% of the initial premium (and any additional premiums from the year in which they are added) can be taken without immediate UK tax charge.
5% is cumulative if not used.
Gain is reduced by a fraction which represents the number of years the policyholder was UK Tax resident in comparison to the number of years the policyholder has held the policy.
This is reduced gain is added to the taxable income in the year of surrender, which could mean a policy holder will not fall into the higher rate (40% and additional rate (45%) rates of UK income tax on a very large taxable gains.
This document provides a high-level summary of some of the key UK taxation benefits which an offshore bond can provide to a UK expatriate investor. Whilst every effort has been made to ensure the accuracy of this document. Gladstone Morgan Ltd do not give tax or legal advice and can accept no responsibility for any act, or failure to act, based upon its content.
Disclaimer: All content provided on this page are for informational purposes only. Gladstone Morgan Limited makes no representations as to the accuracy or completeness of any information on this page or found by following any link on this page. Gladstone Morgan Limited will not be liable for any errors or omissions in this information nor for the availability of this information. Gladstone Morgan Limited will not be liable for any losses, injuries, or damages from the display or use of this information. This policy is subject to change at any time.
It should be noted the services available from Gladstone Morgan Limited will vary from country to country. Nothing in the comments above should be taken as offering investment advice or making an offer of any kind with regard to financial products or services. It is therefore important to reinforce that all comments above are designed to be general in nature and should not be relied upon for considering investment decisions without talking to licensed advisers in the country you reside or where your assets may located. Gladstone Morgan Ltd is not SFC authorized. Gladstone Morgan Ltd in Hong Kong is licensed with the Hong Kong Confederation of Insurance Brokers.