Adviser Guides 1hr
Guide to Offshore Investments
With persistent high inflation eating into income and the moribund economic backdrop and stock market volatility threatening to asphyxiate growth, investors are increasingly looking for investment options that can provide strong returns.
Tax efficient offshore investments have come into greater focus in this context, offering as they do either deferred taxation through bonds or ostensibly stronger returns due to reduced underlying taxation through funds.
But with many charging higher fees and investor protection significantly less comprehensive than for UK-domiciled investments - a key consideration in today’s uncertain times - advisers must place client suitability to the fore.
What are the pros and cons of offshore investing, what type of investments are on offer and who should consider going offshore? This guide will help advisers to answer these questions.
Supporting material supplied by Royal London 360 and the Investment Management Association.
IN THIS GUIDE
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Q. What are offshore investments?
Offshore investments take a variety of forms, all of which are designed to offer tax advantages.
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Q. What are the pros and cons of going offshore?
Improved returns due to reduced taxation form the main benefit, while there are concerns over investor protection on the downside.
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Q. Who should invest in offshore products?
While potentially suitable for a wide range of individuals, those looking to move abroad or to mitigate inheritance tax are likely to benefit most.
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Q. What are the FSA’s requirements for offshore advising?
The UK financial regulator requires advisers to be authorised to sell offshore products.
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Q. Are my clients protected by the FSCS?
Broadly no, although many offshore jurisdictions do offer some form of limited protection for investors.
