Offshore property investment

[Martin Everson]

@Simple q You definitely need an international tax advisor. As some of the suggestions you made such as below make no sense tax wise as I explained. I am sure there are legal ways to reduce your effective tax rate in Australia rather than increase it by using i.e local Seychelles company.

Using an offshore secretary and registered corporate director in the Seychelles seems to be a solution no?

 

[Simple q]

hence I’m on a tax haven board seeking international tax / incorporation advice

 

[fshore]

hence I’m on a tax haven board seeking international tax / incorporation advice

One advice I can give you is that your HK corporate secretary will not make your HK company HK tax resident, and the company and income is likely taxable in Australia. I would start with sorting out that issue before you get into more trouble with other offshore companies.

 

[Simple q]

One advice I can give you is that your HK corporate secretary will not make your HK company HK tax resident, and the company and income is likely taxable in Australia. I would start with sorting out that issue before you get into more trouble with other offshore companies.

I've been researching it, accurate unfortunately, appreciate the input, I need to seek much better accounting

I guess the shady option if I want to stay in Aus and mitigate tax on real estate appreciation (excluding rental income from those AirBNB people) would be to purchase assets in non-CRS countries, with low domestic cap gains using bank in an non-CRS country - Good until there's a global tax database?

For stock purchases (through a CRS brokerage) I assume I would need to gain a government ID, tax ID + bank account in a non-CRS country and use that for the brokerage signup. Xzars posted a great thread that covers ID and tax registration in proxy countries here. Again though it could all come unstuck with changes in bank reporting

Alternatives are selling up in Aus and heading to New Zealand to take advantage of their 4 year tax exemption on capital gains for a while, or I could marry my UA gf, get a passport and get down to 18% at least

HK biz it seems I'm screwed unless I want to head overseas 183 days of the year or want to re-structure

In theory yes. Ask him about setting up an Australian company and then an offshore subsidiary. Offshore subsidiaries of Australian companies are not taxed and money can be remitted back home tax free I thought but I may be wrong.

This seems a far more elegant solution than those above. According to the tax office: 'Generally, a subsidiary incorporated overseas will be treated as a foreign resident under Australian tax law.' There's a few tests that need to be passed. Are you able to point me in the direction of someone with an understanding the finer points of the AU tax system Martin?

I don't know if this is applicable to the OP too, but in some CFC regulations all income of the CFC is taxable in that year. It is then possible to structure an offshore so that tax is only payable when disbursed from a company.

That's all I really want here, though I'm not sure our robust tax system affords the possibility

 

[Martin Everson]

Are you able to point me in the direction of someone with an understanding the finer points of the AU tax system Martin?

For AU I don't know any personally. A quick internet search however turns up the below company but I know nothing more about them sadly

https://www.wealthsafe.com.au/offshore/
P.S If in doubt always try the big 4 accounting firms.

 

[Simple q]

For AU I don't know any personally. A quick internet search however turns up the below company but I know nothing more about them sadly

https://www.wealthsafe.com.au/offshore/

Ahh this guy. had a look at him today as well, seems shoddy. The maths he throws around on his website is inaccurate and the structuring solutions talked about in the blog are.. basic common knowledge

 

[BlueMist]

For AU you may want to check with Healy Consultants, they have always been quite solid. They have international presence in multiple countries, so they may be in a position to give you a good advice. However, I am not sure if you can buy a properties in EU under offshore holding?

 

[hernanday]

Yes, the benefit of being offshore that I’m interested in is tax deferment, profits that can be reinvested indefinitely. We only pay tax when the money is brought back to Australia which isn’t going to happen as I’ll be a non-resident for tax purposes before any withdrawal.

Better make sure Australia doesn't have departure taxes that will tax all your deferred income in a big bunch when you declare non-resident status for tax purposes.
I'd be inclined to just exaggerate your rental expenses out there and move in much expenses in there, then invest the money back into the property withdraw it out as a loan. Use rental income to repay loan, so its about a wash while you build wealth through appreciation.

 

[glam11]

hey simple q any update on your findings as I'm curious myself and like to incorporate an offshore structure from Australia for investment purposes.

 

[ballcaccha]

The European market isn’t a great place to invest your money, especially in property business. Europe is already filled with investments that work through Airbnb. You would better have a look at the American market.

 

[JustAnotherNomad]

I really don’t understand these questions.
Find a country Australia has a tax treaty with which you want to invest in. Read the tax treaty, or have an accountant explain it to you.
Buy real estate, either using a local company or your own name - accountants will be able to tel you which is the better option.
The rental income will most likely be taxed locally anyway and NOT in Australia, but it may increase the taxes you pay on your Australian income. Use local tax discounts and reinvesting to reduce taxes to be paid.
If you invest in your own name, there should be no exit tax since the income has already been taxed.
Disclaimer: I have no idea about the Australian tax code, but that’s how it usually works.

And @fshore is of course right that large purchases usually must be written off over a period of several years. But all of that is very simple for an accountant.