In a high tax rate of income from private wealth management, protection of financial assets in a life insurance contract EU is a sustainable option for legal and tax optimization from a EUR250, 000. With a Luxembourg life insurance company and law, it becomes a dedicated fund for the profit of the private investor.
The private
investor is exposed to high
taxes and uncertainty, with payroll taxes that can evolve, and the
unknown
rates taxes in Europe to cover huge public deficits. While bank secrecy is still
in
force in Switzerland and Luxembourg, the clouds are gathering for the
exchange
of information targeted under the OECD rules, and financial
confidentiality
will lower. The UBS case with the U.S. tax authorities is an example of
misbehavior in finance and private investors have to target legal
solutions to
avoid troubles.
In a context
of fiscal uncertainty, the
investor has the option of outsourcing financial assets
together with the
use of a life insurance contract. When the jurisdiction of the life
insurance
company is located in Luxembourg, there is a legal protection
of assets
and profits benefit of a tax relief related to the creation of
a dedicated
fund under the law. The assets are moved in a private bank in Geneva or
in
Luxembourg, as the choice of jurisdiction does not impact
the tax optimization
process.
The dedicated fund created under Luxembourg law (Law of 6 December 1991 on the insurance industry) is controlled by the investor with management's mandate through a financial advisor. The investment is in custody in a private bank in Geneva or Luxembourg, to take advantage of the sophisticated techniques of wealth management. Taxation on financial income is zero, subject to a minimum of 8 years custody. Nevertheless, it is possible to obtain cash without tax penalties by obtaining a Lombard loan on assets held (Margin loan) with the insurance company assets as collateral. This is a win-win process for the private investor.
This tax planning solution is the entry point of such kind of services, available from EUR250,000. It is applicable to many juridisctions without any limit of amounts. The interest lies in the use of wealth management services in any jurisdictions with the use of private bank, acting like custodian, such as Geneva, and the association with a dedicated fund. Starting from an outsourcing solution that is legal but without tax credit, this process allows a zero taxation during the duration of the life insurance policy. Other advantages such as the inheritance process apply to this tax optimization scheme.
Phone: +41 78 873 58 45
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| The project of
EU regulation authority for alternative funds. The EU bodies are trying to create a single European regulator for the hedge funds. This project face the dispersion of the promoters and fund managers as well as the offshore funds. However, a political will seems to prevail over the obstacles in order to launch another regulation. The weakness of the dollar is associated with a volatility of the currencies. A lower dollar against the euro, combined with a high volatility of the currencies form a new cocktail that worries the central banks and the authorities because it could harm the international economy seeking a recovery. In addition, the dollar's suppremacy could be challenged as an international currency. |
