Offshore Investment Bond

Details

Category: Investments

The use of offshore investment bonds as an additional savings tool for both onshore and offshore investors looking to maximize their retirement savings is increasing as independent financial advisers come to understand that offshore bonds. Offshore investment bonds are theoretically accessible to anyone; it is only the requirements of the individual in question that could potentially restrict access to the products in question. While straightforward pensions remain one of the most taxes efficient ways to save not everyone can get maximum benefit from a pension scheme, some people have funds over their annual or lifetime allowance that they would like to save towards retirement.

Some people simply don’t trust pension schemes following news of various pension scandals where unscrupulous or inept companies have ‘lost’ pensions contributions and left individual policy holders facing an impoverished retirement. Offshore bonds tend to be far more flexible than a qualifying pension product, for example you can have access to funds before the age of 55, money can be drawn down in the form of a lump sum or it can be turned into an income or any combination of both, furthermore an investor can have more say over certain aspects of the bond’s investment. However offshore bonds can be expensive and relatively inflexible in terms of withdrawing from the investment prior to its maturity. Income tax is payable on the chargeable gain at applicable rate(s) only if the gain takes the investor into or beyond the starting rate tax band.

Those who are most likely to benefit from an offshore investment bond at the moment are those affected by the changes to the pension rules in the UK in one or more of the following ways: Anyone who has already contributed their maximum lifetime allowance into a qualifying pension scheme (currently that allowance is one and a half million pounds. There are others who can make use of the tax efficiency and degrees of flexibility offered by an offshore bond, and anyone who would like more information about the products available to them or who would like to find out about specific offshore investment products should consult an IFA. Income tax is payable on the chargeable gain at rate(s) applicable to the investor. Income tax is payable on the chargeable gain at rate(s) applicable to the investor. Chargeable gain taxed at higher rate.