According to the latest independent reports commissioned by financial institutions in the 39 countries who have signed up to the European Union Savings Tax Directive 2005, up to 90% of potentially affected citizens have taken no significant action to reduce or remove their exposure to the incredibly far reaching and potentially damaging legislation that will come into effect on the 1st of July 2005.
With less than 3 months to go until the Directive becomes law, these figures are not only shocking, they are hugely disappointing.
Of those who are aware of the Directive, few have taken the necessary steps to determine whether or not they will be affected, fewer still have sought the qualified assistance of an independent financial specialist to alter their finances and portfolio structure to remove their liability and ensure their financial security and personal privacy.
Cleary not enough media attention has been paid to this legislation because at this late stage in the proceedings many people who will be affected have yet to even understand the fundamental objectives of the Directive.
Shelter Offshore are very keen for people to: -
A) Understand the nature of the EU Savings Tax Directive 2005 (also known as ESD or EUSD)
B) Determine whether or not they will be affected
C) Seek the qualified assistance necessary to make small but effective changes to completely and legally remove all liability
Why?
Because we believe in an individual’s right to privacy and liberty and because to remove one’s liability is SO EASY that anyone who misses their chance to do so is not doing the best that they can for their financial security - and they are missing a golden, possibly once in a lifetime opportunity to legally beat the tax man!
A) Understanding the fundamentals of the Directive.
The Directive is an agreement that has been reached by the 25 EU Member States and 14 other countries known as “Third Countries” to exchange personal and heretofore private information about all customers who earn savings income in one of the 39 countries but who live in another of the 39 countries.
This is known as the ‘automatic exchange of information option’ and it is the fundamental objective of the Directive.
Certain of the 39 countries have adopted a variation of the Directive and instead of insisting their financial institutions impart private customer information, they insist that a withholding tax is deducted at source on interest earned. The rate of this tax will reach 35% as it rises incrementally over the next 6 years.
Famous and widely used offshore jurisdictions such as the Channel Islands, Isle of Man, Luxembourg, Switzerland, Lichtenstein and Monaco are all countries who have signed up to the EU Savings Tax Directive.
Affected individuals will lose their basic and fundamental right to identity privacy - their address, the bank or investment house they use and the amount of ‘savings income’ earned are all facts that can and will be ‘automatically exchanged.’ Furthermore, whether they are subject to the 35% withholding tax or not, they will still be taxed on every penny of their savings income as well.
B) Determining personal liability.
If you are resident in Andorra, Anguilla, Aruba, Austria, Belgium, British Virgin Islands, Cayman Islands, Channel Islands, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Isle of Man, Italy, Latvia, Lichtenstein, Lithuania, Luxembourg, Malta, Monaco, Montserrat, Netherlands, Netherlands Antilles, Poland, Portugal, San Marino, Slovakia, Slovenia, Spain, Sweden, Switzerland, Turks and Caicos or the UK and you have savings or investments that generate you interest or ‘savings income’ including money held in a straightforward bank account and these savings or investments are in one of the other above listed countries it is highly likely that you will be affected by the Directive.
The definition of ‘savings income’ is a tricky one and if you hold any savings or investment policy in one of the above countries and are resident in another then it will be worth your while speaking to an independent financial adviser for clarification. After all, ignorance will be no excuse and once the 1st of July is reached it will be too late to seek clarification as your tax authority will determine whether or not you are liable!
C) Seeking qualified assistance and removing liability.
There are a number of simple but completely effective changes that are applicable to most people and which will completely negate or significantly reduce a person’s liability.
That’s the good news.
The bad news is that these options will only be available to you until the Directive becomes law. Therefore if you do not act now you will regret it later on. It is not a question of act now, repent at leisure…in this case it is a case of don’t act now and repent for ever!
For more independent information from Shelter Offshore about this directive read ‘What is the EU Savings Tax Directive 2005?’
For a free and confidential expert review of your personal financial circumstances complete our offshore advice form and an independent financial adviser with ESD experience will contact you.
If you are liable the adviser will present you with each and every option you have and if you decide to follow his advice he will assist you every step of the way.
Please, please don’t get caught out. This Directive is far reaching but simple to avoid. Take the necessary action today to ensure your personal and financial security remain intact.
