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Your private investment banking guide

private investment banking

Your private investment banking guide

Private investment banking is aimed at high-net-worth individuals, and to be eligible for these sorts of premium banking services you’ll need to have a turbo-charged income or some serious financial assets. This is the silver-service of the financial world—banking with a personal touch—and you can expect to have a dedicated adviser handling your financial affairs and helping you make the best decisions about your money and investments.

Private investment banking services

Private investment banking consists of a range of tailored financial services which usually include:

  • banking services including taking deposits and issuing payments
  • broker services
  • discretionary asset management
  • optional tax advisory services
  • financial concierge services

The history of private investment banking

Private investment banking was the original form of banking, developed in the 17th century as agricultural advances made the traditional landowners extremely rich. To start with, these types of services were used by only a very small handful of the wealthy and, in particular, the royal families of Europe—for example, Coutts manages the finances of the British royal family. Retail banking grew up in response to the growing number of middle class individuals demanding banking services, when the personal element to the service became unsustainable. However, private investment banking continued for the very rich.

Private investment banking today

Most of the large retail banks run smaller private banking divisions or own niche banks which offer the service. The threshold to qualify for private investment banking varies between institutions, but at the very least a person will need to have £250,000 to access private banking services. These more corporate investment banks might offer a wider range of services including inheritance planning, tax planning and asset management, charging either a flat rate fee per annum or on the basis of the number of transactions or portfolio performance.

Switzerland has the largest concentration of private investment banking services in the world, holding about 27 percent of global offshore wealth. The United States has one of the most extensive private banking systems to cater for its huge number of high-net-worth individuals—more than three million.

Many smaller operations that offer private investment banking services cater for particular niche markets. For example, Pryce Warner is an asset management company that specialises in advising and handling the finances of British expats. We offer private investment banking services with the added benefit of 40 years’ experience in dealing with clients who hold assets in more than one financial jurisdiction.

A primer to avoiding inheritance tax

avoiding inheritance tax

A primer to avoiding inheritance tax

Death and taxes—the two certainties in life come together in one of our least favourite taxes, inheritance tax. It seems unfair, doesn’t it, that having paid tax on income, the government then wants a second bite of the cherry when you try to pass on your assets to your loved ones. But with good planning you can mitigate your liability—there are ways of legally avoiding inheritance tax and you owe it to your family to make sure you take all the measures available. This quick guide will outline some of the things you can do, but as individual circumstances vary, make sure you take professional advice to make the most of your wealth.

Your guide to avoiding inheritance tax

None of us like to think about our demise, but planning for how our dependents and beneficiaries will fare without us is essential. In the UK, inheritance tax becomes liable on individual estates worth more than £325,000 or for married couples worth more than £650,000, at a rate of 40 percent. And even if you’re an expat living abroad, if you haven’t taken measures to change your domicile, your estate will still be liable. However, there are measures you can take that will aid you in avoiding inheritance tax:

  • Take advice on what you need to do to change your domicile from the UK to a more favourable jurisdiction. Your domicile is governed by where you were born, where your father was born and where you hold your assets. Obviously, the first two can’t be changed, but by disposing of UK assets and moving your money offshore, you can start the process of changing your domicile. The critical thing is being able to show that you have no intention of returning to the UK. This means relinquishing your UK passport, severing ties with home, selling UK property assets and closing your UK bank accounts. Naturally, this is only worth doing if your new country of residence has a more favourable inheritance tax regime.
  • Additionally, you can protect your money from the taxman by taking advice on tax efficient investment vehicles. Establishing family trusts and gifting money at least seven years before you die are two of the most effective ways of avoiding inheritance tax. Furthermore, putting your pension pot into an offshore scheme such as a QROPS can also contribute to avoiding inheritance tax.
  • If you are settled in the UK and can’t change your domiciliary status, investing in the Alternative Investment Market can be another way of avoiding inheritance tax. Shares listed on this exchange have been made exempt from inheritance tax by the UK government to encourage investment in smaller, less well-known companies. Additionally, investing in a business can result in business property relief—family-owned business premises are exempt from inheritance tax so beneficiaries are protected from having to liquidate the family business to pay tax.
  • By transferring assets into a trust more than seven years before your death, you can bring the inheritance tax liability down from 40 percent to 20 percent.

When it comes to avoiding inheritance tax, the issues are complex and particularly so if you’re a British expat living, working or retired abroad. It certainly pays to take professional advice and Pryce Warner has more than 40 years of experience in this field.

An expat’s guide to tax advice UK

tax advice UK

An expat’s guide to tax advice UK

If you’re an expat living, working or retired overseas, your tax affairs are immediately far more complex than when you lived at home. By how much depends on where you live now and your exact financial circumstances, but talking to a professional for tax advice UK and offshore relevant is pretty much essential. With careful planning and the right investments, you could make a substantial difference to the amount of tax you and your estate are liable for now and into the future.

Tax advice—UK and overseas

For individuals who move around or who hold assets across a range of financial jurisdictions, tax planning is not only more complex but can also be more rewarding. By investing in offshore vehicles, establishing trusts and foundations, and using international bank accounts, a good financial adviser can show you how to reduce your tax burden. However, you’ll need to find someone who has experience in dealing with expat finances and can help you with both your UK assets and your offshore assets. They’ll be able to give you tax advice, UK and overseas, on mitigating income tax, capital gains tax and inheritance tax specific to your own unique set of circumstances.

Tax advice—UK or overseas domicile?

Whether or not you pay UK tax depends on whether you are domiciled or resident in the UK and where you hold your assets. If you are resident in the UK, you will be liable for UK income tax and capital gains tax. However, even if you live abroad, you may still count as domiciled in the UK, as this depends on where you were born, where your father was born and what assets you have in the country. To change your domiciliary status, you need to prove to HMRC that you no longer live here and that you have no intention of returning—which means severing all your ties with the UK, selling UK property and giving up your UK passport.

Tax advice—UK expat experts

Changing domiciliary status isn’t always straightforward, but there are plenty of other measures you can take to reduce your UK tax burden, such as gifting money or assets and setting up trusts. For reliable tax advice, UK and overseas, you’ll want to talk to a firm such as Pryce Warner, who have more than 40 years’ experience handling the financial affairs of expats. Our services include:

  • Tax advice­—UK and overseas
  • Personal financial planning
  • Asset management
  • International banking and investment accounts
  • Guaranteed deposit rates
  • Wealth accumulation strategies
  • Currency services

For tax advice, UK and abroad, and for a full range of wealth management services, contact Pryce Warner.

A quick guide to Cayman Islands banking

Cayman Islands Banking

A quick guide to Cayman Islands banking

The Cayman Islands are known the world over for offshore banking and financial services—and for 102 square miles of sand-fringed tropical paradise, it’s quite a feat to have become one of the world’s major financial centres and, in fact, the sixth largest offshore financial locus. The reasons for this are a favourable tax regime and Cayman Islands banking. Literally thousands of companies are registered here to take advantage of one of the world’s best known tax havens and suppliers of specialised corporate financial services.

Why do companies use Cayman Islands banking services?

The advantages of registering a company on the Cayman Islands are many. Not only is it a tax haven, but it also offers world class asset management, tax consultancy and a wide range of corporate financial services and instruments. However, while its reputation may have been somewhat racy in the past, today this British Overseas Territory is one of the most respected and professional tax neutral administrations in the world. The companies that use Cayman Islands banking services do so to maximise their international tax benefits, not to cheat the system.

The history of Cayman Islands banking

There are more companies on the Cayman Islands than there are people, so how did Cayman Islands banking start? It’s a great story. Back in 1794, George III’s son, Prince William, was rescued from a shipwreck. As a reward, the King vowed never to introduce taxes to the island. No one really knows if this is true or not, but the tradition of no income tax, no capital gains tax and no wealth tax certainly goes back a long way and is a tradition in which the islanders take great pride.

Cayman Islands banking facts and figures

  • About 50 percent of the population of 56,000 are foreigners, from more than 100 other nations.
  • Cayman Islands banking accounts for more than half of Cayman’s gross domestic product and provides more than a third of all the jobs on the islands.
  • There are 212 banks based here with assets of more than US$1.5 trillion. Over 80 percent of the world’s leading banks have subsidiaries registered in the jurisdiction.
  • As well as banks, there are numerous insurance companies based here and over 10,000 hedge funds managing US$1 trillion in assets.
  • It is a centre for companies insuring against medical malpractice and workers’ compensation accounts.
  • The Cayman Islands are in the top 15 countries in the world when it comes to GDP per head.

If you are a British or an American expat, you might reap substantial benefits from Cayman Island banking and asset management. For advice on suitability, talk to a Pryce Warner international finance expert today.

A new guide to private asset management

private asset management

A new guide to private asset management

You’ve worked hard for years, you’ve saved rather than squandered, your house has appreciated in value and you’ve had the odd inheritance or windfall. In other words, you’ve built up a sizeable pot of assets over the years. But what should you be doing with it? How can you be sure it’s all invested in the most beneficial way for you and your loved ones? If this describes your situation, you could be a candidate for private asset management, so read on to find out more about it in our handy guide.

Could you benefit from private asset management?

Private asset management, or wealth management as it’s also known, is not the same as simply seeking advice from a financial adviser. Private asset management takes things a step further—an asset manager will take a hands on approach to managing your money in accordance with your stated goals. So, rather than simply advising you to put your money into a pension, or property, or stocks and shares, an asset manager will actively look after your portfolio of assets, making changes in response to falls and rises in the markets and changes in the economy. This means that your money will be continually working for you in the best forms of investment.

How does private asset management work?

To use the services of a wealth management firm, you are likely to need a minimum investment that may be up to several hundred thousand pounds. If you qualify in this respect, then your chosen asset manager will put together a balanced portfolio of assets for you in line with your own risk profile and financial requirements, be that for security, capital growth or ongoing income. As compensation, you will be charged a fee on an annual or biannual basis that is usually a percentage of the value of your portfolio.

Pryce Warner private asset management

Pryce Warner has been actively managing the financial interests of UK expats for more than 40 years, so we have something of a specialist knowledge in this particular arena. Our private asset management services include:

  • wealth management in line with your financial objectives
  • guaranteed fixed term deposit rates for safe investments with predictable income
  • multi-currency international investment accounts to protect your assets against exchange rate fluctuations
  • tax efficient offshore investment vehicles to minimise your tax liabilities
  • personalised wealth accumulation strategies
  • offshore private investment banking
  • currency exchange with the most competitive rates

To learn more about our private investment management services or to discuss your asset portfolio, please don’t hesitate to get in touch.

What is a QROPS?

what is a QROPS?

What is a QROPS?

If you’re a British expat who has retired abroad, you need to know what a QROPS is, as it could make a significant difference to your financial wellbeing moving forward. So what is a QROPS? A QROPS is a Qualifying Recognised Overseas Pension Scheme—and there are some critical differences between QROPS and UK-based pension schemes. Read our guide to QROPS and then talk to your financial adviser as to whether moving your pension into a QROPS would benefit your own particular circumstances.

The big expat question: what is a QROPS?

If you find yourself asking, ‘What is a QROPS?’—then read on. QROPS are designated pension schemes that are based abroad and which have been recognised by Her Majesty’s Revenue and Customs (HMRC) as fulfilling particular required criteria to make them suitable for UK citizens who have retired abroad.

Transferring your UK pension into a QROPS lets you move your pension offshore without incurring the fees and charges that you would if you put your money into an unapproved scheme.

Once your pension pot is in a QROPS, it will no longer be subject to any future changes in UK pension regulations.

A QROPS can be used as an umbrella for any number of pension schemes and other investment vehicles that you have.

What is a QROPS and what are the benefits of taking one out?

Now we’ve answered the first part of this question—what is a QROPS?—it’s time to explain the benefits of moving your pension into one. And there are certainly some very significant benefits to be had.

  • Once your money is in a QROPS rather than a UK pension, you won’t pay UK income tax on your pension income, which is a substantial benefit given that you might pay UK tax rates of up to 44 percent.
  • If Brexit leads to changes in UK pensions regulations, your QROPS assets won’t be affected.
  • For those expats who will be moving from country to country, QROPS pensions are completely portable and can be drawn down on in whatever currency you wish.
  • British state pensions for UK expats living in Europe may be frozen once Britain leaves the EU, so having your own offshore pension on which you pay no UK tax will go to make up for this.
  • Once you’ve been an expat for more than five years, you can leave your QROPS assets to your spouse or loved ones without incurring UK death duties.
  • When you take out a QROPS, there is no requirement to buy an annuity, which is a massive advantage in these times of poor annuity rates.
  • Depending on what jurisdiction your QROPS falls under, your tax status may change for the better.
  • There are no upper limits on how much money you can place into a QROPS scheme, in contrast to the UK upper limit of the amount you earn each year.
  • QROPS are far more flexible than UK pensions, both in terms of how your money can be invested and how and when you can draw down on them.

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How to use a pension drawdown calculator

pension drawdown calculator

How to use a pension drawdown calculator

Have you planned for your retirement? If you have a pension, do you understand how much your monthly income will be? Pension rules have changed and you have more freedom now to decide how you want to manage your pension pot. You can take out a lump sum and leave the rest for income, but you’ll need to decide how much to draw down and how much income you think you’ll need to live on. To work out the figures, you’ll need to use a pension drawdown calculator.

What is a pension drawdown calculator?

When you’re deciding how much of your pension pot to draw down, you’ll need to understand how it’s going to affect your future income stream. If you draw down too much you could find yourself short of income in the future, but if you only draw down a minimal amount, you might not be making the best use of your capital to fulfil your present goals. The way to sort out this quandary is to use a pension drawdown calculator. This is a financial calculation tool that will allow you to work out how much you can draw as a lump sum and how much income you can take without draining your assets too quickly.

Where will I find a pension drawdown calculator?

Most of the large pension providers, asset management firms and financial advisers include a range of calculators on their websites, including a pension drawdown calculator. You will need to know how much money you have in your existing pension fund and then you can use the calculator to postulate different lump sum drawdowns and how they would affect your ongoing income.

Points to consider when using a pension drawdown calculator

How to use your pension pot to your best advantage is a complex decision and for most people professional advice from an asset manager or financial advisor is critical. However, as you start to think about your future income, here are some points to bear in mind:

  • For a retirement income spanning up to 30 years, it used to be thought that an annual drawdown of four percent would protect the value of your capital. However, more recently, as investment returns have weakened, it’s generally recommended that two-and-a-half percent is a safer drawdown level.
  • You’ll need to think about what your target annual income needs to be, what age you’ll start to draw your pension income, what amount you would want to take out as a lump sum withdrawal and what the annual investment return of your pension is likely to be.
  • You need to be aware that if you take a large lump sum up front, the value of your pension income could fall significantly in later years, and given that we’re all living longer, this is a very real danger.
  • You need to balance the risk of drawing a higher income level in the early years of your retirement against a diminished income in your latter years—and if you’re retiring relatively early, you may have many years left to live.

Using a pension drawdown calculator will help you with the figures, but taking professional advice from an expert is essential for such a far-reaching financial decision.

Where to find expat financial advice

expat financial advice

Where to find expat financial advice

If you live, work or have retired abroad, or if you’re planning to move overseas for either work or retirement, you’re going to need some expat financial advice. The problem is that being domiciled in one country while living in another suddenly makes things that much more complicated. Where do you pay tax? How much? What difference will it make if you move your pension or your assets offshore? And where should you move them to? There’s an awful lot to think about and a lot of decisions to be made that could significantly affect your financial future. So not only do you need professional advice, you need the very best expat financial advice.

Why good expat financial advice matters

As soon as you start to spread your financial interests over multiple jurisdictions, we’d suggest that you start taking professional expat financial advice. There are multiple pitfalls when it comes to tax, income, estate planning and investing abroad, if you happen to get it wrong. But if you get it right, there can be some major advantages for your tax status, your pension and for your beneficiaries. Did you know that you can draw on certain offshore pensions without paying any tax? Or that you can reduce or avoid inheritance tax entirely if your wealth is based in certain jurisdictions? So who should you consult to find out more?

Asset managers who specialise in expat financial advice

Nearly all financial advisers have an area of specialisation, so in your particular circumstances, you need to look for a firm with plenty of experience in expat financial advice. For example, Pryce Warner has been advising UK and other nationality expats on their financial issues for more than 40 years. This means that we have specialist knowledge in all areas of expat finance, and can offer a range of services that are specifically tailored to the unique circumstances in which expats often find themselves.

Expat financial advice from Pryce Warner

We can help you negotiate the financial maze of moving and living abroad. Our services include:

  • asset management and wealth accumulation strategies
  • multi-currency and international investment accounts
  • guaranteed fixed-term deposit rates
  • private investment banking
  • exchange and currency services

When it comes to expat financial advice, Pryce Warner is one of the most respected names in the market. We can help you to plan your financial future and to provide a better future for your loved ones. We make achieving your objectives our primary goal and will help you whether your interest lies in capital growth, income or security for your assets.

Your top 10 tips to investing in property abroad

investing in property abroad

Your top 10 tips to investing in property abroad

Buying property is a great way to invest your money, whether it’s somewhere that you’ll live in or as an investment that can be rented out. Buying property abroad comes with plenty to recommend it—you might want a holiday home or somewhere to retire to, or a place in the sun that will earn a fabulous return from renting out it to holidaymakers. But it also comes with complications—you need to be aware of how it will affect your tax status and what local rules and regulations you’ll need to comply with. As always, it pays to take professional advice on an investment as big as this, but in the meantime here are some tips to investing in property abroad.

Top 10 tips to investing in property abroad

1. Don’t assume the process of buying property in another country is the same as the process you are used to. Do your homework and find out how the system works and what will be expected from you as buyer in your country of choice.

2. Find a local English-speaking solicitor or adviser who’ll be able to explain all the local laws relating to property purchase and renting out. Look for someone independent, so don’t take the recommendation of the vending estate agent or the property developer. Furthermore, if you need to use an interpreter to talk to the estate agent or developer, appoint an independent translator.

3. If you find a property you’re interested in buying, ask whoever is selling it to show you the title deeds—this particularly holds true if you’re looking at investing in land to build on or if you’re buying off-plan from a developer.

4. Ask for written confirmation of any negotiations you enter into and always make sure you ask for a written receipt for any money that changes hands.

5. Ask your local solicitor or surveyor to check that the property hasn’t been offered as collateral for a loan, that it has full utility services and that there are no outstanding debts on them, and to check whether there have been any controversies involving the development of the property.

6. Before you buy, find out about local inheritance laws to ensure that you can leave the property to the beneficiaries of your choice.

7. If you’re taking out a mortgage when investing in property abroad, make sure you understand the rules and regulations governing this and take independent advice over which mortgage provider to use. Pay close attention to the rate of interest to be charged, the period of repayments, and what fees you’ll be expected to pay to set up the mortgage, to pay it off early or to cancel it. Have the mortgage agreement translated into English.

8. Make sure you understand how currency fluctuations will affect the value of your property and your mortgage repayments, as well as how interest rate fluctuations will impact on your situation.

9. Make sure you take into account all the additional costs that arise from investing in property abroad. You will need to pay fees to your solicitor, translator and/or financial adviser, fees for any survey you have undertaken, mortgage arrangement fees, international bank transfer fees, connection fees for utilities, legal fees if you make a will, and various other expenses.

10. You will also need to take into account the ongoing expenses of investing in property abroad, such as annual property tax, local taxes for refuse and mains services, income tax on rent accrued, and service charges if your property is part of a larger development.

For specialist advice on investing in property abroad, contact Pryce Warner today. We have more than 40 years’ experience in advising expats on property investment and all the other financial issues of living, working or retiring overseas.

Your top 5 tax havens list

tax havens list

Your top 5 tax havens list

In a world with more countries than ever before offering tax haven status, using this way to protect your assets from the grasp of the taxman is no longer the preserve of super wealthy billionaires with yachts in the south of France. Protecting your assets offshore is a legitimate way of avoiding tax, as long as you’re transparent about it and follow the rules. So where should you put your money? Here’s our top five tax havens list to give you food for thought.

The top five tax havens list

This tax havens list is in no particular order because no one tax haven is universally better than another—which one is right for you will depend upon your own particular set of circumstances and what you’re looking for from a tax haven. Read through the list and see if there are any that might meet your requirements. Then talk to a professional adviser with experience in dealing with expat financial matters—taking professional advice over something that can have a significant effect on your future wealth is absolutely critical.

1. No tax havens list would be complete without Switzerland—it was the original and is still one of the leading tax havens of the world. It may seem ironic to call a landlocked country an offshore tax haven, but favourable levels of banking secrecy over a long period of time have made Swiss banks famous. Even though its privacy laws have come under international pressure, it still represents an excellent tax haven, with low tax rates and an exceptional quality of life. Switzerland is the world’s 13th largest financial centre, and many banks and international corporations have headquarters here.

2. The Isle of Man is a popular haven for UK residents who want to feel like they still live at home without having to pay UK taxes. This tiny island charges its residents no capital gains tax, no corporation tax, no inheritance tax and no stamp duty. There is income tax for residents, but it’s capped at £120,000, while for companies there are substantial advantages to placing pension funds within the island’s jurisdiction.

3. Jersey is another small English-speaking island with huge tax advantages, so it’s on every tax havens list. Although it is officially part of the UK, it is a self-governed crown dependency, which means it gets to set its own tax levels. Consequently, there is no corporation tax, no capital gains tax and no inheritance tax levied on its residents and businesses.

4. Monaco is one of the smallest tax havens, a tiny principality in the south of France with a reputation for glamour and Grands Prix. Its high property prices reflect the fact that it’s home to innumerable millionaires and billionaires. Why? Because no resident of Monaco has had to pay a penny in income tax since 1869 and corporation tax is also incredibly low.

5. The Cayman Islands have long been a tax haven, to the point where this scattered group of Caribbean islands is now one of the world’s major financial centres. There are more than 90,000 companies and corporations registered here for a single reason—they don’t have to pay any corporation tax. Many Fortune 500 companies have set up subsidiaries on Cayman and this tiny jurisdiction now holds more than one fifteenth of the world’s total banking assets.

Naturally, there are many, many other tax havens that all offer their own specific tax benefits to residents and companies registered within their jurisdictions. This is just a short tax havens list, detailing the most famous of them. However, if you want more information on tax havens and how to use them, talk to a Pryce Warner expert—we specialise in expat financial matters and we’ll be able to advise you on exactly where you should hold your assets.

Bonds for rental properties—what landlords need to know

bonds for rental properties

Bonds for rental properties—what landlords need to know

If you rent out a property on an assured short hold tenancy, you’ll ask your tenant to pay a deposit to cover the cost of any damage that occurs while they’re in possession of the property. These bonds for rental properties remain the tenant’s money throughout the term of the lease, unless it needs to be called upon to fix some damages, and the sum they deposit must be protected through a Government-backed deposit scheme.

Your obligations regarding bonds for rental properties

There are two types of deposit protection schemes for you to choose from when it comes to bonds for rental properties. You can select either a custodial scheme or an insurance-based scheme. You will need to pass on certain information to your tenant within 30 days of the day they paid the bond. This prescribed information includes:

  • Which tenancy deposit scheme you have chosen and information relating to the scheme.
  • Details of why the deposit has been required.
  • Your contact details, or those of your letting agent.
  • How your tenant goes about reclaiming the deposit when they move out.
  • How any dispute over the deposit will be handled.

If you fail to give your tenant this information, they can apply at country court to have the deposit either returned to them or protected under one of the schemes. The court may also order you to pay compensation of up to three times the value of the deposit, so it’s really important to make sure you comply with your obligations in a timely fashion. Additionally, if you fail to protect your tenant’s deposit and provide them with the prescribed information, your powers to evict your tenant will be curtailed—you won’t be able to use Section 21to ask your tenant to vacate the property.

What happens at the end of the tenancy?

Once the tenancy has come to an end, you will need to return the deposit to your tenant, minus any amount that has been agreed between you to cover damage to the property. Bonds for rental properties should be returned to the tenant within 10 days of such an agreement. If you held the deposit in a custodial scheme, your tenant may also be due interest on the money. Deposits protected by an insurance-based scheme don’t accrue interest, however.

If your tenant does not agree with charges you want to place on his or her deposit, then the particular deposit protection scheme to which you subscribed will offer a free-of-charge resolution service, called an Alternative Dispute Resolution service. If both you and your tenant decide to use the service, you will both be obliged to accept its decision over resolution as binding. If either of you refuse to use the service, the dispute will most likely end up in court.

Professional property advice

Buying and letting property can be a lucrative way of both growing your capital and creating an income stream. However, there is a lot to learn if you haven’t done it before—not just about the bonds for rental properties—and even more if you’re thinking of buying and letting a property overseas. Pryce Warner can offer you expert advice in this area, so don’t hesitate to get in touch 

Should you invest in bond properties?

bond properties

Should you invest in bond properties?

If you own your own home, you’re a property investor. But should you tie up more of your capital in property or should you diversify to other types of investments? The property market is generally an excellent option for capital growth, but it’s not easy to invest a small amount of money and if you buy a second property, are you in danger of having all your eggs in one basket? There is a solution. By investing in bond properties, you’ll be putting your money into a portfolio of diversified property interests—which means more flexibility and less risk.

What are bond properties?

Bond properties are the properties and interests held in a property investment bond portfolio. If you invest in a property bond, your money along with that of other investors will be used to create a balanced portfolio of international property interests. It represents a less risky and more convenient way for small to medium-sized investors to invest their capital in property. Most property bonds invest in a wide range of property interests, from all types of residential and commercial property to land acquisition, bridging finance, mortgages and more, usually across a number of countries. The fund will buy and sell properties and charge rent to ensure good capital growth.

What are the benefits of putting my money in bond properties?

  • Investing in property is generally regarded as a safe bet, but spreading your risk via bond properties is safer still.
  • By putting your money in a fund, your property investment is diversified and not too reliant on just one type of property or one country’s economy.
  • Returns are made in a variety of ways—from rent, buying and selling, and charging interest on property loans—and weaker areas can be offset by stronger parts of the market.
  • Each individual who invests in the fund owns a share of each of the bond properties and other interests held.
  • Property funds are the easy way to invest in property as you don’t have to concern yourself with building maintenance, insurance and any of the other responsibilities that come with owning property.
  • Any taxes levied on the bond properties or transactions are paid by the fund, not by the individual investors.

Which property bond should I invest in?

As with any sort of investment, returns on bond properties can go up and down, and some funds are more successful than others. For this reason, it’s a good idea to seek out professional advice before sinking your capital into a property bond. Pryce Warner has more than 40 years’ experience in handling investments and property interests for expats all over the world. Our Warner Global Property & Investment Bond pays a guaranteed return of 4.5 percent per annum, over a three-year term, with higher returns possible. For more information and advice call +44 (0) 203 5880 442.

Your guide to pension investing

pension investing

Your guide to pension investing

Retirement is a fact of life, so it makes sense to prepare for it and put away a regular sum of money to ensure your comfort in old age. Pension investing is something that we often don’t think about until we’re reaching middle age, but really it’s essential to start your pension as early in your career as possible. Of course, you could simply save money using other investment vehicles but pensions offer substantial benefits in terms of income and capital gains tax. It’s never too early to think about the future, so read on.

What should I look for in pension investing?

Planning for your retirement when it’s a long way off can seem boring if you’ve got youth on your side. But if you set yourself up with a reliable pension investment that builds throughout your career, it’s something you’re never going to regret. So here are some of the things you might want to consider when you start looking at pension investing.

Where are you likely to retire­—in the UK or abroad?

If you think about retiring overseas, you need to think about health provision as you will no longer be able to rely on the NHS.

  • How long have you got until you reach retirement age? The fewer years until you stop work, the more essential it is to get a pension plan in place.
  • How will your pension assets be managed? And who will you take advice from? Look for a well-established and experienced company that has a good track record with the particular issues that face you.
  • If you are planning to retire overseas or if you’re currently working abroad, you should employ the services of a specialist international pension provider.

Pryce Warner—the specialists in overseas pension investing

If your pension investing plans involve retirement abroad, or if you’re working and living overseas at the moment, you’ll want to take specialist advice. Pryce Warner has been guiding expats through the pension maze for more than 40 years, and our experts will be able to advise you on the best way to set up a pension that suits your personal circumstances. If you already have a UK pension, we can help you transfer it into a QROPS scheme, which offers a number of substantial benefits over UK pensions for Brits living abroad. We can help you make the right choice of assets for your pension portfolio, and we can also help with a wide range of other financial issues, such as inheritance planning, tax planning and property investment.

For advice on your investments, and to learn more about how the Warner Global Property & Investment Bond could work for you call +44 (0) 203 5880 442.

Should I move my UK pension to a QROPS Australia?

QROPS Australia

Should I move my UK pension to a QROPS Australia?

If you are considering retiring in Australia, you might well think about transferring your UK pension to a QROPS Australia. It’s certainly one of the options, along with putting your money into a QROPS in another country, such as Malta or Hong Kong, that has a double taxation agreement (DTA) with Australia. Certainly, with a decision this important, we would recommend that you take the advice of an expat pension specialist, but in the meantime here are some of the factors to consider.

QROPS Australia: new rules coming into force

If you leave the UK and retire abroad, you’ll still be charged UK tax on a UK pension. However, depending where you move, if you transfer your pension, you could pay less or even no tax on it. For example, most Australian pensions are paid out tax-free. If you’re over 55, you could transfer into a QROPS Australia—new rules have been applied that make it easier than previously.

  • The lifetime limit for an Australian pension scheme is AUD 1.6m.
  • You must be at least 55 years old to transfer your UK pension into a QROPS Australia.
  • For expats who are under 55, you could move your pension to somewhere like Malta or the Isle of Man­—countries which have DTAs with Australia.
  • From 1st July 2017, the maximum annual amount you can put into your QROPS Australia will be set at AUD 100k. However, up to that date you can transfer up to AUD 540k into a QROPS Australia.
  • The benefits of transferring to a QROPS Australia
  • UK pensions limit any lump sum draw down to 25 percent of your pension pot, whereas a QROPS Australia allows you to take out as many lump sums as you want once you’re over 60.
  • QROPS Australia pensions also have no limit on the maximum annual income permitted.
  • Income tax of up to 45 percent can be levied on the income from a UK pension—but there is no income tax charged after the age of 60 on a QROPS Australia.
  • UK pensions can also be subject to tax of up to 45 percent on death, while none is levied on Australian pensions.

Deciding to move your pension to another jurisdiction can be a complex decision and we would urge you to take professional advice. Pryce Warner has 40 years of experience helping expats with their finances and we can make recommendations based on your unique personal circumstances. Call us on +44 (0) 203 5880 442.

10 questions you need to ask about assetmanagement

assetmanagement

10 questions you need to ask about assetmanagement

If you’re thinking about employing the services of an asset manager to steward your wealth, there are certain things you should know about it—such as how it differs from financial advice, the sorts of services most asset managers offer, how assetmanagement is charged for and areas of specialisation. Luckily this handy FAQ guide to assetmanagement should quickly put you in the picture.

What is assetmanagement?

Asset managers take a hands on approach to managing your wealth. They’ll devise an investment strategy on your behalf and carry it out, making sure to factor your specific goals into the investment decisions.

  • How do they differ from financial advisers?

Financial advisers will give you advice on which specific financial products meet your needs but they don’t actually manage your money in the way an asset manager will.

  • Can anyone use assetmanagement?

In theory, the answer to this is ‘yes’, but the reality is that most asset management companies set a minimum level of investment that can really be quite high. Most of their clients tend to be high net worth individuals.

  • What services do asset managers provide?

The core service is obviously investing your money, but many assetmanagement companies do far more than this alone. Additional services can include tax and inheritance planning, investment banking, offshore investing, currency services and so on.

  • What should I look for in assetmanagement?

Look for a company that will actively manage your capital to achieve your stated goals, whether that’s capital growth, income or security. You also want to feel confident that your asset manager is looking to develop a long-term relationship with you, rather than using you for short term profit.

  • What should asset managers be investing in?

This will very much depend upon your stated goals and your own personal circumstances. However, diversification is a key factor for all investment portfolios—you don’t want your wealth to be tied up in just one or two sectors of the economy.

  • Should an asset manager have an area of specialism?

Assetmanagement can certainly fall into niche categories of specialisation. Take Pryce Warner, for example. This company has been serving the assetmanagement needs of UK expats for over 40 years, which means they are truly experts in a complicated area.

  • How much experience should an assetmanagement company have?

Looking after the finances of individuals is a complex and risky undertaking, so you should only trust your capital to a firm of asset managers that has a wealth of experience and a proven track record of success. Look for testimonials and personal recommendations.

  • Is it important that they offer offshore services?

Yes. If you have considerable assets, it will very likely be more tax efficient for you to hold them offshore, so this is a service your asset manager should be able to provide.

  • How will I be charged for assetmanagement services?

Assetmanagement companies will charge you fees depending on the services they provide. They do not work on commission for selling other people’s financial products as they manage your money themselves.

For more information on asset management, call Pryce Warner today on +44 (0) 203 5880 442. If you are concerned about your investments post-Brexit then you may also be interested in what the Warner Global Property & Investment Bond can offer you.

What makes the biggest asset managers different?

biggest asset managers

What makes the biggest asset managers different?

When it comes to asset managers, they are certainly not all the same. But what is it that makes the biggest asset managers successful? How do they stand out from the crowd? And how do you know if an asset management company is the right one for you? A personal recommendation is always helpful, but in the absence of that there are a few things to look out for. This quick guide will help you understand what asset managers do and how to choose one.

What is asset management?

The biggest asset managers are presumably those who are the best at doing their job. But what is that job? Asset managers differ from financial advisers in one key respect. Financial advisers can advise you about financial and investment products but they don’t actually manage your money. Asset managers, on the other hand, will actively manage your capital themselves, moving it between investments as required to fully achieve your objectives. Another difference is that asset managers generally require you to have a minimum sum of money to invest that can be quite high, while financial advisers will help you to manage even relatively small sums of money.

What to look for in the biggest asset managers

  • Find out what their minimum investment level is fixed at—it will give you an indication of the type of clients they focus their attention on.
  • Check out their range of services and whether it coincides with the services you think you’ll need.
  • Look for an asset management company that is interested in developing a long-term relationship with its clients. Only by doing this will they fully understand and be able to steward your wealth towards achieving your goals.
  • Ask up front about their fee structure and exactly what services they are providing for the fees asked.
  • Do you need an asset manager with a particular area of specialism, such as advising expats with their tax and financial issues?

Pryce Warner—one of the biggest asset managers for expats

Pryce Warner is one of the biggest asset managers in the sphere of expat finance. We offer a range of investment and financial services to British and other nationals who are living, working or who have retired overseas. We have more than 40 years of experience in this very specialised niche market and we can help individuals plan their financial future. We take your goals very much into account, and listen to whether you’re looking for capital growth, income or security—for most of our clients it’s a balance of all three.

Pryce Warner services include:

  • asset management and wealth accumulation strategies
  • multi-currency and international investment accounts
  • guaranteed fixed term deposit rates
  • private investment banking
  • exchange and currency services

If you want one of the best asset managers for the expat community, we have the specialist knowledge and breadth of experience you need. If you have been hit hard post-Brexit then you may also be interested in what the Warner Global Property & Investment Bond can offer you.  Call us on +44 (0) 203 5880 442.

Your guide to offshore tax havens

offshore tax havens

Your guide to offshore tax havens

The smart money goes offshore. It’s a perfectly legal way to avoid tax, as long as you’re open about your offshore assets and you follow all the rules. So what makes some countries into offshore tax havens and where are the best of them? Read our quick guide to the subject and you might find it to your advantage.

Offshore tax havens—a definition

For countries to qualify as offshore tax havens, they have to be prepared to levy extremely low or even no income tax and/or corporation tax. Many of them offer further tax exemptions such as no or low capital gains tax or no inheritance tax. The benefit to them for doing this is attracting large corporations and high net worth individuals to do business in their country and so boost their economy. Many offshore tax havens develop sophisticated financial sectors offering a range of products and services such as offshore banking and asset management. For small, resource poor countries, taking on tax haven status can make a significant contribution to their GDP and because of this, the number of offshore tax havens is steadily rising.

The benefits of using offshore tax havens

  • Low or no income, corporation, capital gains or inheritance taxes for individuals living in the jurisdiction or companies for registered there.
  • Offshore financial services and banking.
  • Many offshore tax havens offer banking secrecy, although this is becoming less common as it’s against international banking regulations. However, privacy and confidentiality up to a certain point is still a key factor for offshore banking.
  • Most offshore tax havens require far less reporting on the behalf of corporations than would be required in their home countries. In some, such as Panama, Anguilla, Nevis and the British Virgin Islands, no accounts have to filed at all.
  • Many tax havens don’t require the names of owners of companies to be part of the public records, and allow companies to be incorporated using nominee directors, shareholders and members, to protect the identity of the true owners.

If you feel that moving to offshore tax havens or relocating your assets to them would benefit you, you should seek professional advice as to which would be most appropriate. Please call Pryce Warner on +44 (0) 203 5880 442. If you are concerned about the weakening pound post-Brexit, you may also be interested in the Warner Global Property & Investment Bond.

10 things you didn’t know about IoM tax rates

iom tax

10 things you didn’t know about IoM tax rates 

Do you dream of paying no more income tax? Of moving to a tiny island where the long fingers of HMRC can no longer reach into your pocket? For some, this is the ultimate financial fantasy. One destination for your low tax life could be the Isle of Man—IoM tax rates are low and living there comes with a slew of other benefits that you might not have known about.

Is it just the IoM tax rates or are there other reasons to move here?

The Isle of Man has achieved near mythical status as one of the best tax havens in the world, and for UK expats it’s close enough to home that you won’t feel like you’re living abroad. So why do people come here? Here are 10 great reasons, including IoM tax rates, to move to Douglas.

1.The Isle of Man is officially a ‘low-taxed financial centre’—which means no capital gains tax, no inheritance tax, no corporation tax and no stamp duty.

2.There is income tax. But’s it low—the top rate is 20 percent and it’s capped at a maximum payment of £120,000.

3.You will be charged income tax on your worldwide income, but double tax relief can be granted when appropriate.

4.Regardless of what you earn, if you live on the Isle of Man you have the same personal allowance, whereas if you’re a UK resident you lose the personal allowance if you earn more than £122,000.

5.Furthermore, on the Isle of Man the tax-free personal allowance can be transferred between husband and wife.

6.Retiring here comes with its own benefits. Employer-sponsored pensions based on the island allow benefits to be drawn from the age of 50 onwards and pension funds based here are asset protected.

7.The Isle of Man Companies Registry, based in Douglas, allows you to register offshore companies surprisingly quickly and for a modest fee. The benefits of having an offshore business are not only lower tax demands but lower set up and maintenance costs, asset protection, higher levels of confidentiality and a reduced administrative burden.

8.The Isle of Man was one of only eight countries out of 50 that were investigated to get a clean bill of health in the OECD’s Tax Transparency Report.

9.If you take your mortgage out with a lender based on the island, you can claim a 10 percent tax deduction on the interest you pay. There’s also 10 percent tax relief on the cost of residential or nursing homes up to £9.500 and on charitable donations of up to £7,000.

10.By moving to the Isle of Man, you’ll find yourself in glamorous company with the likes of Trevor Hemmings, Jeremy Clarkson, Nigel Manson and Rick Wakeman.

For more information on IoM tax rates and moving to the island, contact Pryce Warner on +44 (0) 203 5880 442. If you are concerned about your investments post-Brexit then you may also be interested in the Warner Global Property & Investment Bond.

How do I use an inheritance tax calculator?

inheritance tax calculator

How do I use an inheritance tax calculator?

We all love to make plans for the future—our next car, our next holiday, where we’d like to retire­—but estate planning isn’t quite so much fun. However, it is necessary if you want to be sure that your loved ones will inherit as much of your estate as possible. HMRC would also like to take their share but how much will that be? This is when it would be a good idea to use an inheritance tax calculator. In fact, it’s essential if you’re going to take informed decisions about the future of your wealth.

Where can I find an inheritance tax calculator?

Fortunately, the government is very happy to share with you how much of your money it has its beady eye on. Go to Gov.UK and you’ll find a full range of extremely useful calculators, including:

I’m an expat—what about my inheritance tax?

Living or working abroad can complicate matters as far as tax is concerned, so if you want to do the best by your family it would probably be wise to consult an expat tax specialist. The issues arise over the question of where you are domiciled. If you still qualify as UK-domiciled, your beneficiaries will have to pay inheritance tax on your estate.

What makes it difficult is the complexity of the definition of domiciliary status. You can be non-resident in the UK but still be counted as domiciled in the country. You are counted as domiciled if your father was permanently resident in the UK when you were born and it will only change if you can show that you have left the country permanently without the intention to return. If you are able to achieve non-domicile status in the UK, then only your UK-based assets will be liable to inheritance tax.

Can I reduce my inheritance tax liability?

If you use the inheritance tax calculator and you don’t like the results, is there anything you can do to legally pay less tax? Most tax experts will answer in the affirmative to this question. The first thing is to take advice on what you need to do to change your domiciliary status so you’re no longer counted as UK domiciled. The second step is to move your assets out of the UK into more tax efficient financial centres.

Pryce Warner can not only provide you with an inheritance tax calculator, but after 40 years of experience helping expats with their finances, we can give you the best advice for your unique set of circumstances. For more advice, and especially if you are feeling the impact post-Brexit, please call +44 (0) 203 5880 442.

What determines my income tax rate?

income tax rate

What determines my income tax rate?

Rather tragically, we all have to pay tax if we earn a certain amount of income—but we don’t all pay it at the same rate. What determines the income tax rate you’re charged, however, is not always totally straightforward. Not only does it depend on how much you earn, but there are also different rates for income from savings, and your personal allowance may vary due to factors such as whether you claim things like marriage allowance or blind person’s allowance. Confused already? We’ll try to make it clearer.

Current rates and allowances

The amount of income tax you pay each year depends on how much you earn. There is a level of income below which you pay no income tax and this is known as the personal allowance. Above that amount, which is currently set at £11,000, you’ll pay income tax at various rates depending how high your income is. The table below will help you to work out your income tax rate.

Current income tax rates and bands:

Band Taxable income Tax rate
Personal allowance Up to £11,000 0%
Basic rate £11,001-£43,000 20%
Higher rate £43,001-£150,000 40%
Additional rate Over £150,000 45%

However, if your taxable income is more than £122,000, you forfeit your personal allowance.

In addition to paying income tax on earned income, you may also be charged tax on any interest or dividends over and above the tax-free allowance for savings. There are also various income tax reliefs that you might be able to claim. For example, you may be able to claim Marriage Allowance to reduce your partner’s tax if your income is less than the standard Personal Allowance, or you may be able to claim Blind Person’s Allowance. Furthermore, people born before 6th April, 1948, may be entitled to a higher Personal Allowance.

Do I have to pay income tax if I live outside the UK?

But what about your income tax rate if you are a British expat living or working abroad? This situation instantly makes your tax affairs more complicated and it does not mean that you are exempt from paying UK income tax. Firstly, your tax status will be determined by your tax residence and domicile status. HMRC will also take into account other factors, such as the location of assets and the sources of your income and capital gains.

If you are still counted as a resident of the UK, you will have to pay income tax and capital gains tax on any income from anywhere in the world. However, if you are not a UK resident, you only have to pay UK income tax on income arising in the UK. For this reason, you will need to clarify your domiciliary status. But your income tax rate will also vary depending on whether the country in which you reside have a double tax treaty with the UK.

For professional advice and guidance on your income tax rate please give us a call on +44 (0) 203 5880 442 and we will be happy to help right away.