Which offshore investment bond

By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our privacy notice. Decline Settings Accept. New Password. Repeat Password. Please log in or register to access this page. Log In. What is an offshore investment bond?

Pros and cons of offshore investment bonds An offshore investment bond has advantages as well as disadvantages.

As always, investments carry risk, and specific professional advice should be obtained. Start your free trial today. No previous withdrawals have been made. But remember, it may not always be a surrender of segments that produces the smaller gain.

For example, good returns and therefore high profits may mean that a part surrender will produce a smaller gain, particularly where the bond has been running for a number of years and no previous withdrawals have been taken. The ultimate choice will largely depend on the potential tax bill, both now and in the future. TIP - Consider surrendering the required number of segments either side of the tax year.

This may reduce or eliminate the higher rate tax liability. This could have proved calamitous for James. TIP - there may be certain clients who wish to retain the maximum number of segments possible. Issued by a member of abrdn group, which comprises abrdn plc and its subsidiaries. This website describes products and services provided by subsidiaries of abrdn group. Full product and service provider details are described on the legal information.

All rights reserved. You are taxed on the profits in an offshore bond when you surrender it, not when dividends are paid or when you move between different underlying funds or discretionary portfolios. The benefits of compounding the investment returns before tax can be compelling when considered over the medium to long term. Any unused allowance can be carried forward to the following year. For example, Claire has invested GBP 1 million into an offshore bond. In year six she would like to withdraw some money.

When the offshore bond is finally surrendered the amount of any withdrawals taken are added to the proceeds on surrender to calculate the amount of investment gain which will be subject to Income Tax.

Offshore bonds are set up with a minimum of identical policies rather than one single policy. If you want to make a gift you simply work out how much you would like to give away and then calculate how many policies you need to gift. The offshore bond was set up as individual policies and so each policy is worth GBP 75, They decided to give their children, Bill and Georgina, aged 30 and 32, a gift of GBP , each — that is, four polices each.

There is no tax charge on the gift from Robert and Fiona to their children, but if Bill and Georgina surrender any of their four policies they will pay tax at their own income tax rates. It is important that you seek tax advice before undertaking any gifts or transfers of the policies. As a senior international professional or business owner, you know a thing or two about wealth creation.

Let me start off by saying — I get why these products seem attractive. They allow the deferral of tax. But for those living in a low-tax or no-tax environment, why would you need to defer tax? They can be useful for some international investors. Here they are in no particular order …. Access Portfolio is a lump sum, open-architecture, portfolio bond product that claims to provide investors around the world with solutions that adapt to their investment requirements.

Click here for a more detailed look and our verdict. Oracle is a lump sum investment that RL claims can provide potential for growth over the long-term.