Help on how to structure this?

[johnny811]

Currently EU passport but resident in the UK for many years now (10+). Tax resident in UK.
I need some expert's knowledge on how to structure the below.

• Move existing property owned in my name on an offshore company.
• Buy more property using a combination of personal funds, my (legit) Ltd's funds + mortgage (highly leveraged, around 60-70%).

The point is to have minimal tax paid, retain as much profit as I can and either reinvest to property, or send to MT (or other app bank) and use it for personal spending. I'm not talking millions here, I'm just trying to see if there is a way to fly under the radar and keep reinvesting. Anonymity is a very nice to have too.

Suggestions?

 

[johnny811]

I was informed that for property holding in the UK, it would make more sense to set up with BVI, because Cyprus is a more expensive jurisdiction, and there is the additional expense of audited accounts, which is not a requirement for BVI (only preparation of financial accounts).

Also with Cyprus companies I need to show full management in Cyprus so I would require directorship services (extra costs + paperwork).

Thoughts?

 

[JohnLocke]

johnny811 said:
I was informed that for property holding in the UK, it would make more sense to set up with BVI, because Cyprus is a more expensive jurisdiction, and there is the additional expense of audited accounts, which is not a requirement for BVI (only preparation of financial accounts).
Click to expand...

things are changing all the time. The BVI seems to be cheaper at first but if you look deeper into it you will find out that the administration costs and accounting costs are much higher compared to Cyprus. That's at least my experience!

johnny811 said:
Also with Cyprus companies I need to show full management in Cyprus so I would require directorship services (extra costs + paperwork).
Click to expand...

Isn't it the same in the BVI? Maybe someone else can shed some light on it. It's aprox 3 years since I looked into BVI corps. and simply gave up also because the entire process to setup the company is too complicated.

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[Martin Everson]

@johnny811 I am still not sure you understood what I said in previous thread 🙁

As I mentioned in other thread investing in UK property via an offshore company you will have to pay a special tax in UK called ATED i.e Annual Tax on Enveloped Dwellings. The tax increases each year and there is no clean way around it. You didn't mention if this property is rented out? If it is rented you know that you will owe income tax plus ATED each year and the offshore company will be expected to do a tax filing each year to HMRC. Oh and council tax will still have to be paid no matter what. I am still not sure what tax you want to minimize? Please advise.

Annual Tax on Enveloped Dwellings

In UK companies are taxed on profits. If you want to become a landlord and own multiple properties and run them as a business then a UK LTD company may be best. Within a LTD company in UK you can keep rolling your profits into new property before end of tax year then you would be showing no profit for the year if done correctly. You would not be liable to pay any taxes that way. Using this strategy you can defer when you pay your tax by ending the rolling of profits into new property. When it comes to cashing out then relocate to a tax free country and pay yourself a dividend. Dividends paid to foreign residents are free of WHT or simply sell the company on while being non-resident ange¤%&

You may need to consider SDLT before deciding on company of personal ownership for your next property. The issue gets complex very quickly and use of an offshore company will only increase the complexity and therefore cost to you.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.