What is offshore trading?
Offshore trading basically means to invest in the global markets from a trading or brokerage account that is located in an offshore jurisdiction. The term offshore is used to describe a bank, corporation, investment, or deposit that is usually located in a tax haven location.
How do offshore investments work?
South Africans are allowed to take a maximum of R10 million a year offshore if they have been granted a SARS tax clearance certificate to move money abroad. Without this tax clearance certificate, you can only send a maximum of R1 million out of South Africa into your foreign bank account each year.
What are offshore bonds?
What are Offshore Bonds? Offshore Bonds are also known as International Bonds. They’re a tax-efficient way for you to invest money over the medium to long term. This is usually over five years or more. With an Offshore Bond you can invest a lump sum or invest regular payments.
Is offshore trading legal?
While it’s true that there will always be instances of shady deals, the vast majority of offshore investing is perfectly legal. Offshore investing, despite its sketchy reputation, is a legal, effective way to invest in entities that are only available outside your home country.
Do you pay tax on offshore investments?
You will still need to pay UK income tax on your dividends from foreign shares, and UK capital gains tax on any growth. However, the UK has ‘double taxation’ treaties with many countries, which should usually prevent you being also taxed in the country where the fund is based.
Who is an offshore bond suitable for?
An Offshore Bond is an investment solution designed for clients investing over the medium to long term (5-10 years) with the objective of achieving a mix of potential capital growth, determined by the funds held within it, and an option to receive an income through tax-efficient withdrawals.
How much can you withdraw from a bond tax-free?
A: This is a rule in tax law which allows investors to withdraw up to 5% of their investment into a bond, each policy year, without incurring an immediate tax charge.
