Whether an individual decides to purchase land and build a property or buy an existing property consideration should be given to the ownership of such an entity.
A high net worth individual with properties or other assets in a number of countries may wish to hold these through the medium of a company rather than in his own name, so that upon his demise tax advantages can take effect. This saves legal fees and avoids publicity. Again, not everybody wishes to advertise wealth and an individual may wish to hold property through an offshore entity simply because of the privacy which the offshore arrangement gives.
Advantages of offshore property ownership include avoidance of inheritance tax, avoidance of capital gains tax, ease of sale which is achieved by transferring the shares in the company rather than transferring the property owned by the company and reduction of property purchase costs to the onward purchasers. Taking the example of investment in property in the EU by an offshore company, use of an appropriate offshore vehicle can offer relief from income tax, capital gains tax and inheritance tax. It should be remembered, in particular, that when a non resident company disposes of a property investment, no capital gains tax is charged and holding through an offshore company, removes the application of inheritance tax which would apply if a non-domiciled investor held a property in his personal name.
We can provide help and advise on such matters including Trusts, helping our clients making informed decisions before committing to a purchase.