So the G20 has seen Gordon Brown trying to save the world and prove to everyone in the UK that he is not a complete waste of space after all. Well, many have still to be convinced that he is worthy of the job he holds seeing as he was not democratically elected to become Prime Minister – but in the meantime, all that aside, let’s get straight to the point of this article and examine the outcome of the G20 summit and its relevance on our lives as expats.
How are expats affected by the G20 offshore tax haven clampdown? The answer is, very few who have taken professional advice and who are saving, investing, banking or doing business offshore legitimately will be adversely affected by it at all. However, it is still important to understand why the crackdown has come about, and what it does mean in terms of loss of privacy of transactions for example.
You could say that the crackdown on tax havens has come about because of the global financial crisis, and the fact that nations such as the UK and the USA have bailed out so many banks and printed so much money that they have to ensure no tax is falling out of their net. After all, they need every single penny they can lay their hands on if they are ever to sort out the financial mess their economies are in! So, what does this mean for expat offshore savers?
Well, certain offshore tax havens such as Lichtenstein and Switzerland have been under extra scrutiny of late as the G20 leaders, together with the likes of the Organisation for Economic Cooperation and Development have been getting tough with jurisdictions famed for their banking secrecy. Such tax havens are frowned upon because other nations have no idea who is utilising their services - either for their own legitimate or illegitimate financial gain. It makes onshore countries such as France and Germany twitchy because they have no idea whether any of their tax paying citizens are avoiding taxation by hiding assets in such secret locations.
Pressure is now being put on the most secretive havens to disclose who is invested therein – however, whilst most havens are willing to cooperate when tax evasion or money laundering activities are suspected, most want to retain the privacy they offer the likes of legitimate expatriate savers and investors. This is where the question of how the G20 crackdown on tax havens will affect you really becomes more important. If you’re an expat you’re probably well aware that you are likely to have a very legitimate right to offshore your money and assets if you want to – and that for some there are legitimate tax saving advantages to doing so as well. At the same time however, you might prefer to keep information about your financial activities to yourself, so the thought that suddenly offshore tax havens will be forced to disclose your every financial move probably doesn’t sit too well.
Well, the good news is that everyone is trying to tread as carefully as possible so as not to upset the balance and route out not only the criminal tax evaders but also the legitimate offshore investors. However, if you are in any doubt about what the G20 proposed sanctions mean for you and your financial status, it’s time to call in a financial adviser to assess your situation in light of this week’s proposals in London. With complete knowledge about what the G20 crackdown will mean for you specifically, you can then act accordingly to ensure that you are completely comfortable with the way your financial affairs are managed and protected.
