{"id":24123,"date":"2019-04-08T00:49:52","date_gmt":"2019-04-08T04:49:52","guid":{"rendered":"http:\/\/www.escapeartist.com\/?p=24123"},"modified":"2020-07-22T03:49:37","modified_gmt":"2020-07-22T07:49:37","slug":"offshore-companies-a-guide-to-asset-protection-strategies-part-5","status":"publish","type":"post","link":"https:\/\/www.escapeartist.com\/blog\/offshore-companies-a-guide-to-asset-protection-strategies-part-5\/","title":{"rendered":"Offshore Companies: A Guide to Asset Protection Strategies – Part 5"},"content":{"rendered":"

The Income Tax has created more criminals than any other single act of the government. <\/span><\/i><\/p>\n

~ Barry Goldwater.<\/span><\/i><\/p>\n

There is nothing more detrimental to the prosperity of a society than a tax system that punishes people for being successful. High taxes on wealth are particularly damaging. They can have a negative effect on the economy as people with wealth would prefer to move it abroad to a country that doesn\u2019t have such stringent tax policies. \u00a0<\/span><\/p>\n

Therefore, people are moving their wealth abroad through <\/span>offshore companies<\/span><\/a>. There is nothing illegal about building an offshore company to structure your wealth for maximum protection. Some might question the ethics involved in the matter, but no one can challenge the logic behind availing this option when it\u2019s available.<\/span><\/p>\n

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Protecting Your Assets is a Logical Choice<\/b><\/h2>\n

Everyone who has wealth and a good head on their shoulders wants to protect their wealth from undue government taxes. Whether you are a salaried individual, self-employed business owner, investor or inherited your fortunes from a relative, you want to make sure that you get to keep as much of the wealth as possible.<\/span><\/p>\n

If you ask any smart economist, they\u2019ll tell you that taxing wealth isn\u2019t rational. If a person has paid tax on their property at the time they earned the money, then they have paid their due share. Taxing their wealth again through estate taxes is adding insult to injury.<\/span><\/p>\n

Consider the tax rates in Western economies. The income tax rate in the U.S. is quite high and goes from 10% to 37%. In Canada, the rate can go as high as 33% while in some European nations the income tax rate can go up to 50% of your earnings each year.<\/span><\/p>\n

Think about it. A person with a high earning, let\u2019s say Mr. \u2018A\u2019, who earns $300,000\/year has already paid almost 30% to 50% of his income in taxes. That\u2019s around $100,000 to $150,000 in taxes and much more than what roughly ten average salaried individuals pay in a single year.<\/span><\/p>\n

Now if Mr. A acts smart about how and where he spends his money, he ends up being penalized for it. Suppose he puts the majority of his money into long-term, secure assets that build wealth instead of squandering it away on meaningless expenses for short-term benefits. Maybe he puts it into building a business that creates employment for other individuals in the country.<\/span><\/p>\n

In the event of Mr. A\u2019s passing away, his wealth could be subjected to further estate taxes of up to 30% to 50% depending on what his net worth is.<\/span><\/p>\n

A tax regime that penalizes savers and good financial planners, and rewards people who are wasteful with their money by giving them social security benefits is one of the main reasons why Western economies find themselves in an ever-increasing debt cycle.<\/span><\/p>\n

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\"OffshoreOffshore Tax Havens<\/b><\/h2>\n

Offshore companies offer a great way for individuals to protect their accumulated wealth. They can do this by establishing companies that operate from tax havens. A rising number of <\/span>offshore destinations<\/span><\/a> are becoming popular with people due to their 0% tax rate and the ease of registering a company there. <\/span><\/p>\n

Gibraltar is one such destination. It is a small and financially independent territory consisting of a single port city. It lies in southern Spain, surrounded by the Mediterranean Sea on three sides and connected with Spain to the north.<\/span><\/p>\n

The port city is one of the overseas territories that are part of the UK. However, the territory is independent and has its own governing law. It has a 0% income tax rate. More importantly, there is no wealth tax, capital gains tax, estate duty, sales tax or VAT. Businesses based in the area and residents of Gibraltar can use a variety of tax exemptions to reduce their tax liability.<\/span><\/p>\n

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Advantages of Offshore <\/b><\/h2>\n

Gibraltar is a favoured tax-saving destination for many. It offers many benefits for individuals, companies, and businesses that have a goal of using its free tax regime.<\/span><\/p>\n