Going Offshore: Is It For You?
NOTE: This report is presented with the understanding that the publisher is not engaged in rendering legal or accounting services. Questions relevant to the specific tax, legal, and accounting needs of the reader should be addressed to practicing members of those professions. This information was gathered from sources believed to be reliable but it can not be guaranteed insofar as it applies to any particular taxpayer. Wealth International, Limited specifically disclaims any liability, loss, or risk, personal or otherwise, incurred as a consequence directly or indirectly of the use and application of any of the techniques or contents of this report.
An economic crisis looms
Uncle Sam and his children want your money
Care to play the legal lottery? Your participation is not voluntary.
Your privacy is low to nonexistent
Big Brother wants to know all about you
Later may be too late
What to do? / A Quick TestTrusts
Contractual Trusts
Important U.S. Court Cases Concerning Contractual (Pure) Trusts
Corporate vs. Trust Attributes
Trusts That Protect
Onshore or Offshore?
The W.I.L. Trust
Who Uses Trusts?
Ownership vs. Use
Other Useful StructuresProtecting Your Home or Real Estate
Protecting Your Investments
Protecting Business Assets
Avoiding Probate
Using a Business to Shelter Tax-deductible Benefits
Income Splitting
Profit upstreaming
Going offshore is legal
Tax avoidance, deferral, and reduction is legal
Asset protection is in your best interest
Access to high yield investments available only to offshore entities
The rules may change but the existence of opportunities will remainAppendix 1: Offshore Trust Structuring and Its Impact on the United States Taxpayor
Introduction
The "Grantor" Trust with a US Settlor/Grantor
The “non-Grantor” Trust
The Wealth International, Ltd. Alternative
Relevant Law and RulingsAppendix 2: Belize and its Merits as a Trust Jurisdiction
Preface
Unfortunately writing this report has been like trying to hit a moving target. Every time one entertains the hope that things have stabilized one is proven wrong. In the wake of the attacks of September 11, 2001 governments have stepped up their attacks on political and financial freedom, seemingly with an eye towards ending both as we have known them within our lifetimes. Our attempts below to summarize the current situation cannot replicate the impression obtained from following the news and seeing the ongoing stream of repressive measures introduced. Thus we recommend that after reading this you proceed to the Offshore News Clips pages and start reading. (In many cases the headline and brief summary is sufficient to give you the idea behind the item.) A quick trip to the news page will provide an effective antidote to complacency and thoughts that “Maybe things are not really as bad as I imagine”. Having said this, neither doing nothing nor worrying too much about the destructive forces at work in the world are prescriptions for living an enjoyable and fulfilled life. Inform yourself, act appropriately, and then move on. In this spirit we write.
This report should also be interpreted as an ongoing work-in-process. Nobody in this arena has the final word. Even the law makers and administrators sometimes can not decide what their own directives actually mean. Changes in laws and our understanding of the relevant laws and principles, as well as improvements in our ability to articulate certain points, will be reflected in changes to this work.
Introduction
The purpose of this report is to introduce you, the reader, to some concepts and tools that are useful for protecting and increasing your wealth, and to persuade you that they are relevant to you. We believe that investing a moderate amount of time on the subject will provide large returns. If the language sometimes sounds paranoid or conspiratorial it only reflects our assessment of the dangers threatening unprotected assets in today’s legal, political, and economic world. In fact the dangers may be greater than even the authors perceive. Fortunately significant protection can be acquired for a relatively modest expenditure of time and money.
We would like to emphasize right from the start that this is an introduction only. There is no shortage of more comprehensive and legally exact coverage of the subject matter. This treatment is designed to impart some basic knowledge to those with little or no backround in using legal means to protect and enhance one’s wealth.
Your Assets are in Danger!
An economic crisis looms
This section used to follow the warnings below, but now we believe it should precede all others. To be blunt, the danger of a severe economic contraction which could destroy a large percentage of your wealth is great ... greater than any time since the worldwide depression of the 1930’s. Uncle Sam and his international subsidiaries, notably the International Monetary Fund (IMF), could, yet again, come up with yet another string and baling wire solution that, yet again, temporarily enables the world economy to delay the day of reckoning. But the ability to effect this is severely diminished. Every crisis since the 1960’s has been papered over by increasing the systemic level of debt, public and private. The investment asset mania of the late 1990’s and attendant spending binge may finally have saturated the capacity for another round of this game. Consumers, firms, and governments are all too loaded down to take on any more debt, or so it seems. When the music finally stops, the historical lesson is clear. Stocks, bonds, real estate, and most real assets, as well as economic and political liberty, sustain significant bear markets.
A deeper examination of current background economic factors could lead a thinking person to conclude that an economic crisis that makes the 1930’s look good by comparison is not out of the question by any means. In short, the U.S. macrofinancial situation looks precarious, to say the least, and any decline in confidence in the dominant world economy could lead to a collapse in economic activity, the dollar, the stock and bond markets, and wealth. Do not just take our word for it! Check out the opinions evinced at sites such as The Daily Reckoning (especially articles by Dr. Kurt Richebächer and “The Mogambo Guru”, Richard Daughty) or Prudent Bear to get an alternative perspective to the standard pap. Decide for yourself whether the events that they fear - which admittedly they have been warning about for years - are at least possible, and therefore worth insuring against.
This might not even be the most pressing risk to consider, as even a “collapse” unfolds over time. The attacks of September 11, 2001 succeeded in closing the financial markets for a week. Another attack could conceivably close them down for much longer, if knowledgeably and expertly executed. (The reasoning behind accepting that this is a possibility is elaborated on here.) History shows how empires have terrorism and military risks that regular nations do not, and the U.S. is the only candidate for this appellation today. The consequences of a prolonged closure of the U.S. markets is difficult to imagine, but surely they are not ones that anyone would wish to subject themselves unprepared.
A discourse on investment strategy is beyond the scope of this report, but if the risks touched upon above are real then initial appropriate actions are clear. Start with a clear-eyed assessment of your current situation. The perils to your wealth and assets do not just come from the markets themselves. Governments notoriously use the pretext of a crisis to further limit freedoms and appropriate assets. It is plausible that existing laws authorizing government control or appropriation of financial assets would be put to use in such an event. The 1933 gold confiscation, and the lack of accompanying outcry or resistance, is an example within living memory of the use of such laws. (People were forced to sell all their gold to the Federal Reserve for $20.67/oz. Gold was then revalued to $35.00/oz.) In advance of or in the absence of a complete appropriation it is reasonable to expect the imposition of currency controls that restrict the exchanging of dollars for other currencies and the moving of assets offshore, as occurred during World War II. Assets that remain onshore, immobilized within the system, would be vulnerable to inflation and future government decrees and actions. There are countless historical examples of this.
The risks discussed above apply to everyone, regardless of economic class, political ideology or affiliation, or how many friends you have in high places. We believe that they alone constitute a set of compelling reasons to start internationally diversifying your financial assets, including jurisdictionally - i.e., moving some of your money “offshore”. Below, we detail the risks emanating from the leviathan the U.S. legal/governmental complex has become. They provide a somewhat different motivation and entail additional methodologies to “protect” your assets. While the potential horror stories implied in the detailing may seem abstract and low probability to the average individual, we submit that they are real and, again, worth insuring against - provided this can be accomplished at a reasonable cost. We will argue that going offshore is logically an element of a sound asset-protection strategy.
Uncle Sam and his children want your money
There is a Chinese saying to the effect that “The dog with the bone is always in danger.”
Big government keeps getting bigger, and its beneficiaries are insatiable. This is the fact that drives everything else. Today taxes take roughly 50% of a middle class family’s income. The power of the tax collection machinery is not diminishing, to say the least. The federal budget increases every year, no matter who is in power and what their professed philosophy. In the end this reflects the thinking of the general public, who find no problem with using the middleman government to extort wealth from their fellow citizens. The rugged individualist has given way to the politically organized entitlement seeker. In the words of Oscar Wilde: “If you rob Peter to pay Paul, you can always count on the support of Paul.”
In summary, the principles of human rights, due process, justice, fairness, consistency and logic, as people normally understand them, do not guide the agenda and rulings of the U.S. justice system, especially when one of the parties is the government. The guiding principle is force, which they have the overwhelming capacity to administer and are willing to use, often to excess. The judiciary was allegedly designed to be a check against legislative and executive branch power expansion. The reality is that the courts are part of the government and administer government rules. Every government employee has a direct pecuniary interest in maintaining a well-funded and intimidating government. Juries have historically been the last barrier and ultimate check against unrestrained government power. This is simply no longer the case. Judges’ instructions limit jurors’ discretion, and the juries are chosen with an eye to weeding out independent thinkers. And the chances are that half a given jury's members will be government beneficiaries anyway.
Care to play the legal lottery? Your participation is not voluntary.
Your privacy is low to nonexistent
A recent search on the Internet using the search-word “SSN” revealed that often for less than $100 the following information about you is available:
- Address History
- Bank Account Search - National
- Bank Account Search - International & Offshore
- Civil Records Check by County
- Civil Records Check by Federal District
- Corporate Affiliations
- Criminal Conviction History by County
- Criminal Conviction History by Metro Area
- Criminal Conviction History by Federal District
- Criminal Conviction History by State
- Criminal History National
- Criminal History - National Media Scan
- Criminal Incarceration - Past/Present Prison Incarceration (Federal)
- Date of Birth Search
- Death Records - National SSN Search
- Driving Records (with DOB and/or DL#)
- Driving Records (without full information)
- Education Verification
- Employment Verification (Maximum Historical Record)
- Household Demographics (names of people living in house)
- Insurance Policies with Cash Value & Annuities
- Package Tracker (UPS, FedEx & Airborne shipments)
- Phone Number Trace #1: Finds address from known listed #
- Phone Number Trace #2: Finds address from known unlisted #
- Phone Number Trace #3: Finds listed # from known address
- Phone Number Trace #4: Finds unlisted # from known address
- Phone Number Trace #5: Finds unlisted phone # and address by name, city and SSN
- Phone Number Trace #6: Finds unlisted # by name and city
- Phone Records: Cellular Calls
- Cellular Calls with Dates and Times
- Phone Toll Records: Long Distance from residential number
- Phone Toll Records: Local Area Tolls from residential number
- Post Office Box traced to address
- Professional License Search (not all states available)
- Public Filings Scan - Bankruptcy, Liens, Judgments, UCC, etc.
- Real Estate Ownership by County
- Real Estate Ownership by State (not all states available)
- Safe Deposit Box Search
- SSN Locator - Find a person’s SSN #
- SSN Fraud Search
- Stocks, Securities and Mutual Funds Search
- Utilities Search
- Worker’s Compensation Records (not all states available)
Most of this information is available within hours, if not minutes, and can be obtained using one’s credit card right over the Internet. Note that the common denominators necessary for finding this information are the numbers associated with your name and the property that you own. All of this information is available commercially. One can only imagine what the government with its unlimited resources already knows or can find out about you. Recent proposed legislation that would have imposed greater restrictions on the sharing of collected information was substantively gutted by the lobbying of the affected corporations. Federal guidelines require the use of Social Security Numbers on Drivers Licenses going forward. Without some form of privacy protection, your life is an open book to anyone with a few dollars and a computer. Attacking your assets is a simple matter when they can be located so easily due to being held in your name and/or associated with your SSN.
Big Brother wants to know all about you
While “1984” may have arrived a little later than the title of the famous novel implied, it is here now. In addition to the information above, considered private by most people, your credit record and a transaction-by-transaction record of your credit (or debit) card purchases are easily accessed. For frequent card users an intimate X-ray into the card owner’s life is easy to obtain. For instance, anyone thinking of issuing you a credit card or extending a loan can access that database. Of course any government employee will have no problem gaining access. Requiring more effort, but easy enough, is the gathering of transaction histories from checking accounts. Courts have repeatedly ruled that there is no right to privacy that extends to banking records. (An all too plausible-sounding theory is that the cost of each checking transaction is subsidized, i.e., one is charged less than the cost of processing the piece of paper, in order to encourage people to put their transaction records where they can be easily monitored.)
Meanwhile, proposals and laws too numerous to detail have followed the 9/11/2001 attacks and taken the attack on privacy to new heights. Any one person could be a terrorist, and any financial transaction could be supporting a terrorist operation, the reasoning goes, and thus every person and transaction should be tracked and analyzed. Welcome to the Surveillance State.
Later may be too late
Once you are sued or otherwise dragged into the judicial system it is too late to protect yourself. Any transfers of assets to entities or locations seemingly better protected from potential judgement can be ordered reversed, on pain of incarceration or further monetary penalty. Transfers of assets in order to escape an exisiting judgement (these days you could probably be charged on the basis that you suspected you would soon be subject to a judgement) is called “fraudulent conveyance” and is itself a crime. Too late is exactly that ... too late.
What to do?
It is not productive to obsess on or live in fear of the potentialities itemized or implied above. What is productive is to to take cost-effective action, similar to buying insurance.
A Quick Test
We invite you to answer the following questions:
Draw your own conclusions here. You know your situation best. But as the number of affirmative answers and the income/asset numbers increase then, we think, the more relevant the concept of taking active measures to protect your assets becomes.
If you read the rest of this report you will be presented with tools with which one can:
- Protect your home, investment real estate, liquid assets, anything of value.
- Protect a business or other valuable assets from government and other claimants.
- Reduce or eliminate expensive liability insurance premiums.
- Avoid estate taxes, death taxes, and inheritance taxes. Avoid costly and time-consuming probate.
- Reduce your small business and investment taxes.
- Defer taxes on the income and capital gains from investments.
Proposed Solution
As the system does not offer any protection worth counting on, effective protection action must come from the asset owner. A start at counteracting the described threats and problems is to implement a strategy that adds legal obstacles and provides privacy. The further you remove your assets from harm’s way the lower the chance that they will have to be defended at all. But if they should be attacked one will be prepared, and not have to desperately shore up one’s defenses at the last minute.
A well designed strategy that will reduce your exposure to those who would take what you have involves changing the legal ownership, but not necessarily the parties who obtain use and enjoyment, of those assets and thereby disassociating your name from the property. This can be accomplished in more than one way. The most important points to remember are: 1.) They can not take away from you something you do not have, especially if it is outside their legal jurisdiction, and 2.) It is difficult to determine what assets you have an interest in if your name is not associated with them. [PLEASE NOTE: We do not condone or advocate attempting to renege on the responsibilities of fulfilling one’s agreements or of making whole those whom one has damaged. Such attempts generally prove more costly in the end than just “facing the music”. We do promote protecting oneself against potential losses unrelated to the operation of universally understood and shared laws of justice, such as thinly-disguised theft under color of law.]
Once you have divested yourself of ownership of those assets, we will argue that the most effective method of removing them from harm’s way is to site the ownership of the property in an offshore venue, ideally a country that does not routinely recognize U.S. court judgments or acquiesce to U.S. government demands. If your would-be adversary must travel to a foreign country, hire foreign attorneys, and persuade a foreign court to do what it is reluctant to do (because the country’s reputation as a safe haven, and therefore its potential earnings from offshore financial services, would be jeopardized), then he or she is likely to give up at the start. Ownership can be structured so that the property may be relocated on short notice, making successful pursuit more difficult still. Dividing your assets among a series of different holding entities adds further to the cost of pursuit.
An ancillary benefit of moving offshore is that one can start limiting the amount of information that one feeds to the multitude of commercial and governmental databases. Credit or debit cards issued by offshore banks do not, as a rule, automatically feed account transactions into a central database the way that a card issued by a U.S. bank would. An offshore credit card issued to a holder whose name is distinct from yours would provide an additional buffer.
Limits to any Solution
In a world where governments and courts operate as if no law applies to them, no solution is foolproof. The ideas presented herein are not a cure-all. Even with every asset of real value out of your name and in an offshore structure, if the right (i.e., wrong) people think you have access to valuable assets somewhere/anywhere, then they may just throw you in jail, or break your figurative legs some other way - such as harassing less-protected family members, until you “cough it up”. In the end it makes sense to think of your and your would-be aggressor’s situation inside a cost-benefit framework. The harder it is for any party, government or private, to discover and gain access to your assets the more likely it is that they will spend their time on alternative pursuits, going after easier prey. And the less costly it is for you to throw up some obstacles in the path to your assets, the more sense it makes to do so.
Inadequate Solutions
A sole proprietorship provides absolutely no asset protection from potential lawsuits. Business assets under this structure can be used to satisfy a personal lawsuit, and the reverse. The effectiveness of a U.S. Corporation in protecting assets significantly depends as much on whether privacy-enhancing actions such as those suggested in this report for the individual are taken on behalf of the business, as on the power of the legal structure itself. Attorneys have recently taken to attacking the officers, directors, and major shareholders of a corporation in addition to the corporation itself. Such individuals are well advised to take measures to protect themselves against this possibility. And, of course, shares held in one’s own name can easily be attached to satisfy a claimant.
Many businesses start out as “S” corporations. Unlike traditional “C” corporations, S-Corp shareholders are taxed on their shares of the profits whether or not the profits are distributed, thus the profits are said to be “passed through” to the shareholders. But the distribution of profits as dividends is not a further taxable event to the shareholders. The limited liability trait of C-corporations is retained. Incorporating as an S-Corp cannot put the owner in a lower federal or state tax bracket because of the profits pass through, but it can reduce self-employment taxes when compared to operating as a sole proprietorship. As a business grows the limitations of the structure, such as the restrictions on the number of shareholders and the types of entities that are allowed to be shareholders, can end up being material.
The best-known business structure is the “C” corporation. Because profits do not automatically flow through to shareholders they can be advantageously divided between the business owners and the corporation, possibly lowering the total tax liability in the process. This strategy can work effectively for a small business, but requires precise calculation and planning. Some tax breaks are available when a corporation provides deductible, but tax-free to the recipient, benefits to its employees, including the CEO/majority owner, as is discussed further later in this report.
A problem intrinsic to the U.S. C-Corporation is that any income earned by the C-Corp will be taxed twice, once at the corporate level and a second time when it is paid out to the shareholders as dividends. Net revenues not paid out as salaries or other deductible expenses are given a haircut before anyone else gets his or her hands on them, even if the intended use is reinvestment in the corporate business itself. Moreover, some types of C-Corporations such as “Personal Service Corporations” are taxed at high rates from the first dollar earned. In most cases a conventionally managed C-Corp will not by itself produce important tax savings, and alternative or supplemental strategies are needed if tax savings as well as superior liability and asset protection are sought.
In conclusion, tax reduction and asset protection benefits do not just suddenly appear by dint of incorporating. Corporations do have their uses. Of course the vast majority of companies with publicly traded interests choose a corporate structure. The huge body of law and legal rulings concerning corporations, as well as the large number of knowledgeable professionals in the arena, must be considered plusses. But from our perspective it seems that anything the private individual can achieve using corporations can be achieved just as well using other arrangements, discussed subsequently, with additional asset protection, privacy, and possibly tax savings benefits in the bargain.
Note: Some individuals have a philosophical objection to using corporations because their use is a privilege bestowed by the State. While sympathetic to this view, we are more inclined to be pragmatic here and look at the final result. If using them increases one’s well-being without directly hurting another then we will not object.
A Non-solution for Protecting Assets
The Revocable Living Trust: This well-known entity provides NO ASSET PROTECTION. It can help your estate avoid the time and expense of probate and is almost certainly preferable to doing nothing, but there are other alternatives to “nothing”. The revocable living trust is a statutory creation of the United States government, and by intention and design provides only limited benefits.
Tools
The structures referenced previously are domestic U.S. entities. The trust that we now introduce is jurisdiction independent at the cenceptual level initially discussed, but we will contend that it is more effectively used from an offshore venue.
Trusts
Trusts have been used by the wealthy for centuries. A trust started by Patrick Henry during the American Revolutionary era is still in operation. Black’s Law Dictionary defines a trust in this manner: “A trust is a right of property, real or personal, held by one party for the benefit of [or “in trust for”] another.” In the simplest terms, a trust is where one party puts assets in the hands of a second party for the benefit of a third party. Informal agreements can have trust-like characteristics, e.g., when you put a valuable possession in the temporary safekeeping of a friend.
Our working definition of a trust is: A contract in which an individual, usually called the Grantor or Creator, transfers title to property to one or more Trustees, to be held and administered for the benefit of one or more Beneficiaries. The contract may also include a Protector, who has the power to discharge the Trustee(s), without going to court, for the purpose of protecting the interests of the Beneficiaries. The Trustees may have the option to hire one or more Managers to oversee the day-to-day operations of the trust.
The diagram below summarizes the nature of the relationships created by a trust document (contract).
The concept of the trust arose under English common law, and those jurisdictions that adopted English law such as the United States recognize the split interests that derive from such a contract. Importantly, under legal systems that recognize trusts the trustees are not deemed to own the trust property and thus trust property cannot legally be used to satisfy debts or judgments of the trustees. Absent fraud or other unlawful conduct, parties to the trust contract are also not deemed to be liable for any debts incurred by the trust itself. Only the trust assets can be used to satisfy trust liabilities. (Potential liability holders, e.g., a person contemplating making a loan to the trust, should be fully informed about this beforehand.) However, we will note right here that courts can and do rule that the substance of a trust agreement differs from its formal legal structure and then use that as a justification for using trust assets to satisfy non-trust liabilities, e.g., an IRS tax deficiency claim. The courts can operate capriciously. Forewarned is forearmed.
There are over 50 different statutory trusts in use in the United States, including Revocable Living Trusts, Charitable Remainder Trusts, Land Trusts, and Children’s Trusts. Anyone who exercises the option and privilege of using such legislative entities is subject to the statutes and associated regulations. Trusts may also be created with no reference to a specific legislative act. Instead all the terms are specified in the contract itself. In the U.S. such trusts are variously called pure contract trusts, Common Law contract trusts, Unincorporated Business Organizations (UBOs), and Consitutional trusts, among other names. Those terms or descriptions have been often applied to instruments whose purveyors have wildly overstated the benefits thereof, in our view, and therefore we will just call these nonstatutory trusts “contractual trusts” for brevity’s sake (notwithstanding the term’s built-in redundancy). The legal foundation for these trusts is your right to enter into any contract that does not have unlawful purposes.
Contractual Trusts
When unconstrained by the need to conform to specific rules and regulations the trust becomes an immensely powerful instrument that can serve any number of useful purposes. Their flexibility is virtually unlimited. However, conventional accountants, attorneys, and other professionals generally gravitate towards the various statutory trusts, and may not be practiced with the concepts of the nonstatutory trust and their inherent flexibility.
A historic example of the power and flexibility of trusts in action is given by “Massachusetts Trusts”, which were contractual trusts used in the early 19th century to circumvent a state prohibition in Massachusetts against the organization of corporations that dealt in real estate. The Massachusetts Trust was a private agreement whereby property was conveyed to trustees to be held and managed for the benefit of the holders of transferable certificates issued by the trustees. These certificates, functionally similar to shares of stock in a corporation, entitled the holders to share in the income from the property, thereby obtaining some of the advantages of incorporating while sidestepping the regulatory burdens and restrictions placed upon corporations. Two famous English businesses that were organized as contractual trusts are Lloyds of London (1811) and The London Stock Exchange (1802).
Among the purposes for which a U.S. domestic contractual trust can be created is to serve as an active operating business entity. This is doable, but not necessarily easy. The trust is unfamiliar to many people and is often viewed with suspicion. The IRS has also threatened to “crack down” on “abusive trusts”. Given their relative scarcity as business setups, it may draw unwanted attention. In countries whose legal systems are not based on English law the trust structure may be ignored and the trust assets deemed to be owned by the trustees. In the end using a trust this way may create more difficulties than it resolves.
We are aware of claims asserting a variety of tax benefits that come from using a domestic U.S. contractual trust as a legal business structure, up to and including the claim that they are nontaxable entities, but in our view evidence backing those theories that is both recent and compelling is lacking. When a controversy arises contractual trusts are generally classified as one of the statutory trusts and assessed accordingly. Or they are classified as corporations, as is discussed below. In a land where the courts do as they please, having good legal arguments and even good precedent in one’s favor are not always enough.
To jump ahead a bit: Contractual trusts are more easily utilized as the passive holder of investment assets or shares of interest in business structures, than as the primary business entity itself. Examples of how this might work are shown in the next section, “Tool Use Examples”. Trusts are very useful for privacy and asset protection purposes, if run in a legally appropriate and discreet manner.
Important U.S. Court Cases Concerning Contractual (Pure) Trusts
If a U.S. court judge would decide to actually pay attention to precedent, then he or she would discover the following cases pertaining to contractual trusts:
- Berry v. McCourt, 204 NE end 235 (1965). A pure trust is a contractual relationship in Trust form.
- Baker v. Stern, 58 A.L.R. 462. It is established by legal precedent that pure trusts are lawful, valid business organizations.
- Weeks v. Sibley, (D.C.) 269 F. 155. A pure trust is still legal, even if formed for the express purpose of avoiding taxation.
- Eliot v. Freeman, 220 U.S. 178 (1911). The creation of a pure trust is not subject to statutory law, and a pure trust is not subject to legislative restrictions as are corporations.
- Schuman-Heink v. Folsom, 15g NE 250 (1927). If it is free of control by certificate holders, then it is a pure Trust.
- Goldwater v. oltman, 292 P. 624 (1930). A Business Trust is lawful wherever contracts are lawful.
- Morrissey v. Commissioner, 296 U.S. 344 (1935). A Trust is taxable as an association if a corporate structure is maintained.
Corporate vs. Trust Attributes
If a contractual trust possesses certain “corporate attributes” it can be classified as a corporation and taxed under statutory provisions regulating corporations. This is a possible pitfall from using a trust as a primary business legal entity. These four corporate attributes are:
- Centralized management.
- Continuity of life.
- Limited personal liability of trustees.
- Easy transferability of trust beneficial interests.
As long as a contractual trust possesses fewer than three of these attributes (the Massachusetts Trust above had at least three of them), then as discussed in Treasury regulation 26 CFR §301.7701-2 it will theoretically not be taxed as a corporation. A contractual trust can easily be written such that it lacks both continuity of life and easy transferability of beneficial interests, and thereby avoid being treated as a corporation. At the risk of repeating ourselves: Be warned that in a controversy if an IRS agent or an IRS-friendly judge (IRS-antagonistic judges are scarce) is the one doing the interpreting then you should not expect to receive any benefit of the doubt. Easy transferability of beneficial interests, such as where beneficiaries hold stock certificate-like “units of beneficial interest”, as opposed to being explicit parties to the trust document itself, is an invitation to be classified as a corporation.
Trusts That Protect
It is vital to be aware that a trust can only protect your assets or reduce taxes if the trust is: 1.) Organized as an irrevocable trust, meaning that the grantor cannot change the trust’s terms or take back its assets after its creation, and 2.) Managed by a trusted independent third party person or company who is NOT UNDER YOUR CONTROL. If the assets effectively remain in your control (which would be the case if the trust were revocable) then it may be construed that you still own the assets. If you are also a beneficiary, either explicitly, or substantively when the funds flows are followed, then the trust could be deemed a “nominee” or “sham trust” or “alter ego”. The asset protection and tax advantages would be severely jeopardized. The IRS could retroactively impose taxes and concomitant penalties once it was ruled that a purported trust was different than previously represented. Care is clearly called for in creating the trust document and choosing a managing organization. The old bromide about the devil being in the details certainly holds true here.
Points 1 and 2 above are basic necessary conditions for any trust, foreign or domestic, statutory or not, to provide effective asset protection. In going offshore an important technical legal matter is whether the trust is classified as a “Grantor” or “non-Grantor” trust. The law germane to the matter is complex, and is addressed in Appendix 1.
The contractual (nonstatutory) trust document is in principal situs/jurisdiction independent. Some trust documents are written to be easily transferable among jurisdictions, while certain “sovereign” trust documents claim they fall under international law and not under the laws of any one country. Practical matters to consider are setup and maintenance costs, and where the assets and trust parties are located. If a trustee is offshore then he/she is harder for U.S. legal system or government agents to pressure. (In the post-9/11 world, far greater attention is called for in determining just what jurisdictions are effective in this matter.) If the asset being defended, such as a piece of real estate, is domestic then where the official owner (the trustee) is located may make little difference. Our opinion is that if the cost difference is not large and there is access to trustworthy people then there is no reason not to make the leap offshore.
How does the W.I.L. Trust fit into the above discussion? The situs of the trust is Belize. It could be justifiably labeled a statutory trust, as it resides under the legal umbrella of The Belize Trust Act of 1992. Belize has a large body of trust law that would serve when a legal controversy comes up that is not addressed in the document itself, but the document itself is extremely comprehensive. There is no requirement in Belize trust law that a trust be registered in any way for it to be considered legally domiciled in Belize. W.I.L. trusts are not registered. It is truly a private contract. In effect, then, it has more in common with a nonstatutory contractual trust than any statutory trust. More detail on Belize trust law is provided here.
Who uses trusts?
Well known individuals who have utilized trusts for asset protection, tax savings, or other reasons include the Kennedy, Rockefeller, Mellon, DuPont and Hunt families, Ross Perot, Ronald Reagan, Rupert Murdock, Jimmy Carter, Senator Bob Kerry, and Henry Ford II. As mentioned previously, Founding Father Patrick Henry created a trust that continues to function as a going business today. Obviously the idea of using trusts is not some offbeat, fringe idea.
Ownership vs. Use
The idea of relinquishing formal legal ownership of your assets may feel uncomfortable initially. Besides the apparent riskiness, the idea conflicts with the mindset of “owning” things. However, once one develops a familiarity with the basic philosophy and the concrete specifics of operating a trust the prospect stops feeling intimidating, and ultimately the idea may actually seem natural. The operating concept changes from being an owner to something in the nature of a guardian of assets. Even where assets are not subject to your legal direction you may still make recommendations to the trustees and/or trust manager without damaging the trust’s legal substance. The trustees and managers are bound by a fiduciary duty to maintain and improve the assets of the trust for the benefit of the beneficiaries. They would have no reason to object to an informed and prudent recommendation regarding trust assets. A famously wealthy man put it most succinctly:
“I don’t want to own anything;
I just want to control everything.”
- John D. Rockefeller (Sr.)Of course you should enter into the arrangement only if you trust the trustees, managers, and, where applicable, protector. The contractual trust is indeed a flexible and powerful tool, but requires the proper set up and management in order to serve its intended purpose.
Other Useful Structures
Some statutory entities can be put to good use, and we will touch on them briefly. Our general bias is that they are used more effectively in combination with trusts than as stand-alone entities.
Limited Liability Corporations (LLCs)
The LLC is a relatively new U.S. domestic legal business entity that can be viewed as a hybrid between a partnership and a corporation. It has the same limited liability protections (as far as they go) for company member/shareholders as the corporation but can be given characteristics so that it is treated like a partnership for tax purposes, thereby avoiding double taxation. There is considerable flexibility in the allocation of profits, taxes, liabilities, etc. among the unit holders. An LLC can be structured such that the LLC membership shares receive a much greater level of protection from judgments than shares in a corporation (similar to how a limited partership interest in a Limited Partnership can be made very hard for a creditor to get at, for those familiar with those twists). LLCs escape many of the restrictions that apply to S-Corporations, and do not have the reporting requirements that C-Corporations have once foreign individuals or companies own a certain percentage. The LLC effectively combines with foreign or domestic trusts for many purposes. Much of the Limited Partnership law and precedent applies to the newer LLC, so despite being new instruments they have a solid foundation in commercial law.
International Business Corporations (IBCs)
The offshore analog to the U.S. C-Corporation is the IBC, except that they usually have the restriction that they cannot do business in their sponsoring country. For an operating offshore business an IBC is usually the most appropriate structure. They can be used as alternatives and supplements to offshore trusts. Creation and annual maintenance fees are generally higher than is the case with trusts. In common law jurisdictions they may be less flexible than trusts, but are sometimes more useful, not the least because they are readily recognized as valid legal entities throughout the world.
Tool Use Examples
Examples where tools introduced previously are put into action are given below. They are presented to serve as examples of simple but effective tactics that are available once a decision to act is made, whether that action is to set up one’s business in a more effective legal manner, or to move some of one’s affairs offshore. Note that the examples are in summary form, with the legal and other details that would accompany an actual transaction largely glossed over. When and if the time comes for action you should consult with an experienced practitioner. But come prearmed with an expanded mind.
Protecting Your Home or Real Estate
To minimally protect your home you can transfer ownership of the property to a domestic contractual trust. The trust is considered separate for ownership purposes, and thus provides partial asset protection. Note that if the transfer is made, then at the very least a search of assets held in your name would no longer immediately reveal your home. If under IRS guidelines the trust is deemed a “Grantor Trust” then it is not considered distinct from you for tax purposes and does not file a separate tax return.
If better protection is desired for the equity in the home and the mortgage holder (if any) is flexible, then the house ownership can be placed in a limited liability company (LLC) and then 99% of the membership interests of the LLC conveyed to an offshore trust. As the manager and one of the LLC members (1% owner) the client can maintain some control of the home while protecting it.
Once the home is placed into an LLC/offshore trust combination, the equity could then be stripped from the home by taking out a second mortgage on the home, and the cash from the second mortgage could subsequently be conveyed to an offshore trust. The earnings from investing the cash placed into the foreign trust should at least cover the interest payments on the second mortgage or, if deployed skillfully, may considerably exceed the interest due.
Rental property can be protected with the same strategies utilized for the owner-occupied home discussed above. It would be wise to place each property into a different LLC and then take the LLC membership interests from each LLC and place them into one or more offshore trusts.
Protecting Your Investments
Portable investments such as stocks, bonds, futures contracts, commodities and their like, can be readily moved between jurisdictions, unlike real estate. As with real estate they can be protected with an LLC/offshore trust combination. However, protection can be achieved more simply by transferring the ownership of these mobile assets directly to the independently managed foreign trust in a jurisdiction where asset protection is strong legally ... and in practice. (Stay apprised of ongoing developments in order to accurately assess this.)
For those holding investments with large embedded capital gains, independently managed foreign structures used in conjunction with a private annuity can help defer and/or reduce taxes. The mechanics of this are beyond the scope of this report, but it is a possibility to be aware of.
Protecting Business Assets
An owner of a business containing valuable assets could fruitfully consider the idea that “They can’t take from you what you don’t have.” A physician, dentist, chiropractor or other medical professional, for example, could place all professional equipment, e.g., x-ray and ultrasound machines, microscopes, lab equipment, examination tables, etc. into a trust or LLC/trust combination (if the entity will be receiving payments and engaging in banking a trust alone may be problematical). All other office equipment, e.g., desks, computers, fax and copy machines, filing cabinets, etc. could then be placed into a separate trust. Automobiles could be placed into additional separate LLC/trust combinations for greater protection. The main business would continue to function, receiving payments, hiring employees, paying bills, etc., but would own few assets, the usual targets of liability proceedings, while leasing its necessary property and equipment from the various independent trusts or LLC/trust combinations. Liability insurance savings could quickly cover any setup costs.
Avoiding Probate
The basic concept here is that when you die the trust does not. This applies even in the case of the Revocable Living Trust. The more thorough a job that you do of conveying your assets to a trust, the less is left to be run through the probate mill. The probate process takes time and money for even the simplest of estates, and the details go into the public record. This use of trusts is not esoteric in the least. Further using a trust to actually reduce estate taxes deviates from the strictly routine, but is not difficult. Many sources on the subject of using trusts to achieve this exist. Anyone with an estate whose value exceeds the estate tax exemption should consult a professional knowledgeable in this legal domain immediately.
The remaining example strategies emphasize saving taxes, although this certainly does not conflict with protecting assets. They are included to give a taste of what is available once one has addressed the basics.
Using a Business to Shelter Tax-deductible BenefitsIf you are one of the small businesspersons organized as a sole proprietorship or general partnership then there are many tax reduction strategies that would become available upon conversion to a corporation, LLC, or business trust. Specific tax breaks may vary with structure type. Many of the expenditures that you are paying with after tax income could be paid for with pretax income after the reorganization. Also, certain benefits that are tax-free to employees are still deductible from gross income for the business.
As an employee of your business, the business can legitimately pay for many of your normal every day expenses, nontaxable to you and deductible as business expenses. Every dollar deducted in this way legally escapes self-employment, federal, and state taxes.
Examples of benefits that can be provided to you tax-free as an employee of a business under the right circumstances, while being deducted as an expense include:
- Depreciation allocatable to the portion of your home used as an office
- Depreciation on furniture and appliances used as business assets
- Mortgage interest, repairs and maintenance, utility and insurance costs allocatable to the portion of your home used as a business office
- Health/accident insurance and life insurance (up to defined limits) premiums; medical/dental expenses of employee spouse and dependents
- Expenses associated with your children’s daycare
- Business-related travel and vacation expenditures
- Business-related education costs (employees only)
- Business and professional club dues
- Cost of company gym and exercise equipment
- Legal expenses (employees only)
- Business-related company car, airplane, or boat expenses
In the end the claimed expense should have a credible business purpose. It is a good idea to consult with someone experienced in the area when making such decisions. Before deciding to legally transform your hobby or avocation into a “business” become aware of the guidelines the IRS or other tax authorities use to determine whether you are running a valid business, and thus allow the concomitant deductions.
Income splitting
If one’s business is structured as a corporation, LLC or business trust then the flexibility available in allocating shares, units, or beneficiary interests can be used to produce tax savings. Gross business income can be spread among the entrepreneur, family members and the business entity. When correctly engineered the resulting reduction in the collective tax liability can be nontrivial.
Profit upstreaming
Tax savings can be increased when utilizing a strategy known as “Profit upstreaming”. Profit upstreaming means to shift profits from a company in a high tax venue to a different company in a low or no tax venue. Multinational corporations utilize this strategy routinely. Profit upstreaming can be used as part of an asset protection and privacy enhancement program.
You may be familiar with a technique used by U.S. companies to reduce state income taxes. Company “A” in a state with high state income taxes (e.g., California) reduces its taxable income by allowing most or all of its profits to be realized by, or to “flow upstream” to, company “B” in a state with no state income taxes (e.g., Nevada). Total after-tax profit is increased, since state income tax is avoided with little additional effort or expense. The Nevada Business Upstreaming System is in fact commonly used to reduce state taxes. The generalization of this involves realizing profits in an entity legally domiciled in any low or no tax jurisdiction rather than one domiciled in a high tax jurisdiction. Upstreaming strategies utilizing offshore structures can materially reduce or defer state and federal taxes.
1.) The Nevada Upstreaming System:
2.) The Foreign Business Upstreaming System: In this strategy the profits of a U.S. company A in any U.S. state or territory flow directly upstream via Internal Revenue Code §162 to a foreign company B in a low tax or tax free country. When appropriately arranged and executed state and federal taxes are reduced today and the savings can be invested on a tax-deferred basis.
A Profit Upstreaming System can shift thousands, millions, or even billions of dollars in profits to a low or no tax jurisdiction, and defer state and/or federal taxes until the accumulated funds are remitted to a U.S. taxpayer. A non-Grantor foreign trust, such as is discussed in Appendix 1, could serve as such a vehicle. Profit Upstreaming Systems provide you and your beneficiaries and causes with the same advantages enjoyed by large multinational corporations.
Upstreaming methodsThere are many ways to legally move profits from one company to another.
The logical choice of direction is of course to upstream profits from the company in the higher tax legal venue to the company in the lower tax venue. Shifting income from country to country is no different in principle and no more difficult in practice than shifting income from state to state. Once the suitably structured business entities are in place in the appropriate states or countries, income shifting can commence, as from Company A to Company B in these examples that illustrate the idea:
Loans: Company A in a high tax jurisdiction can take out a loan from company B in a low or no tax jurisdiction. Company A deducts the interest paid to company B. Company B realizes the interest income with minimal or no taxes due.
Leasing: Company B in a low tax jurisdiction leases equipment to Company A in a high tax jurisdiction such as the U.S. or Canada. Lease payments are deductible under U.S. and Canadian tax laws while Company B realizes the lease income with low or no taxes due.
Advertising: Company B in a low tax jurisdiction can act as an advertising agency for company A in the high tax jurisdiction. The ad agency commission is deductible.
Accounts Receivable Factoring: Company A in a high tax jurisdiction can sell its receivables for cash at a discount of 20% to 40% to company B in the low tax jurisdiction. This reduces the taxable profit of company A in the high tax jurisdiction, and increases the profits of company B in the low tax jurisdiction.
Licensing: Company A in a high tax jurisdiction pays a licensing fee for the sale of software, clothing designs, etc. created by company B in a low tax regime.
Professional and Other Services: Company A in a high tax jurisdiction can take a deduction for services, e.g., consulting, business management, secretarial, publishing, writing, or accounting, performed by and paid to company B in a low tax jurisdiction.
Patents, Copyrights, Royalties: Company A in a high tax jurisdiction can make royalty payments for inventions, songs, movies, books, software, etc. to company B in a low tax country that has a tax treaty with the U.S.
There are a large number of plausible ways to upstream profits from one company to another. As long as there is economic substance behind the reported numbers they are entirely legitimate.
Note: Profit upstreaming (or “downstreaming”, when that directional implication is more appropriate) is periodically denounced as an unnecessary and unfair tax “loophole” for international companies. As one might imagine, enforcement is difficult as the argument comes down to the nebulous subject of appropriate transfer pricing, particularly when the products are components or other intermediate goods of hard-to-determine value. But as we have said before in other contexts, should such a controversy occur then the government agent has a decided advantage in enforcing his or her view. Undoubtedly the money-laundering police also have their eyes on the area, as it is a way to evade money transfer reporting requirements. Exporting a 5 carat diamond and declaring it to be worth $50 would raise questions, if discovered. Thus the proviso of there being economic substance to back up reported transactions.
Going Offshore
1) There are two distinct domicile categories used for establishing trusts and corporations, or their equivalents:
a.) Domestic: Established within the United States.
b.) Foreign: Established outside the legal jurisdiction of the United States.2) Trusts and corporations domiciled in certain foreign tax havens have certain advantages, including:
For reasons detailed in Appendix 2 Wealth International Ltd. has chosen Belize, an English-speaking country with a modern financial services sector located in northern Central America, as the situs (legal location) for the trusts we offer. Belize does not impose taxes on profits from exempt trusts or corporations. The criteria for exemption are easily fulfilled by nonresidents of Belize. There is no requirement in Belize trust law that a trust be registered in any way for it to be considered legally domiciled in Belize.
Summary of Advantages of Establishing a Properly Structured Foreign Entity
- Threat from judgments, liens and seizures can be diminished or eliminated.
- Impounding of safe deposit boxes and bank accounts can be avoided.
- Greatly enhanced privacy.
- Assets can be isolated from domestic economic disturbances and controls.
- Tax reduction and/or deferral.
- Probate and estate/inheritance taxes can be reduced to the vanishing point.
- Shifting or upstreaming business profits from the U.S. to the low/no tax country becomes possible.
- Above can be achieved while continuing to manage and use the assets.
Some Simple Mathematics
What do you get in exchange for a lifetime of working and paying huge taxes? The statistics are that the majority of all retirees wind up being dependent on Social Security to stay out of poverty. In this situation Uncle Sam is truly your master. Social Security is not a fund, nor a valid legal contract, but merely a continuing resolution to keep taxing one group of people in order to pay the funds to another group. This is "guaranteed" to continue for exactly as long as it remains expedient. It is a flimsy foundation for your financial well being. However, if you managed to save only $5,000 in taxes per year and invested it at 15% per year within a tax-deferred vehicle, then a substantial asset reserve would quickly be created.
Using the numbers from the paragraph above, $5000 per year in tax savings earning a 15% rate of return and invested using a vehicle that allows for tax deferral grows to $122 thousand in 10 years, as shown in the diagram on the right. In 20 years the additional accumulation amounts to $594 thousand. And in 25 years there is a total of $1.23 million more than there would have been in the absence of any tax savings. Obviously if you save more and earn still higher investment returns then the numbers look even better. Your cumulative tax savings grow so large so fast because of the power of compound growth in combination with a structure that provides tax deferral. Saving taxes using the vehicles and techniques outlined herein is a simple and effective way to build your family’s wealth. Why not start today?
Additional Points
Going offshore is legal
Just mentioning the subject of offshore trusts and foreign bank accounts to the typical United States or Canadian resident raises questions of legality and conjures up images of money laundering drug dealers, shady con artists, and, especially today, shadowy and lethal terrorist organizations. As we know all too well, such people exist. But they are not the dominant players in the offshore arena. The North American governments have obviously been successful at instilling fear and doubt in the minds of their citizens. The objective of the casting of suspicion on things offshore is to keep their citizens’ assets where the government can monitor, tax, and grab them. Or to put it more succinctly, to control. But the fear and doubt recedes when one develops knowledge of the actual laws, begins to think more globally, and starts conducting business with others around the world. As in all of life, what was once novel becomes routine with repeated exposure. Having a bank account or other structure offshore is PERFECTLY LEGAL. The only imperative is that you report those offshore activities where a legal reporting requirement exists. Offshore trusts and corporations can be structured and managed so that you end up with very few or no reporting requirements.
Tax avoidance, deferral, and reduction is legal
There is a difference between tax evasion, and tax reduction, tax deferral, and tax avoidance. Tax avoidance is a legal principal, and is engaged in by every business that takes advantage of its legal deductions. Tax avoidance is using the rules to your advantage. Tax evasion is breaking the law. Setting up your affairs to minimize your taxes and taking every tax deduction that is consistent with the tax code and regulations IS 100% LEGAL.
Every taxpayer has the well-documented legal right to structure his or her financial affairs in conformance with the tax code so as to minimize his or her tax liability:
- Judge Learned Hand stated in the landmark case of Gregory v. Helvering: “Anyone may arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the treasury; there is not even a patriotic duty to increase one's taxes.”
- Taxpayers are not required to continue that form of organization which results in the maximum tax. [Raymond Pearson Motor Company v. Commissioner, 246 F 2d 509 (1957)]
- U.S. taxpayers may also use tax havens for tax planning reasons. Some transactions conducted through tax havens have a beneficial tax result for U.S. taxpayers that is completely within the letter of the U.S. tax laws. [Federal Tax Guide Reports in official IRS Agents Manual]
Supreme Court Justice Louis Brandeis once drew an instructive analogy that illuminates the legalities of the difference: "Where I live in Alexandria, Virginia, near the Supreme Court building there is a toll bridge across the Potomac River. When in a rush I pay the toll and get home early. However I usually drive outside the downtown section of the city, and cross the Potomac on a free bridge. If I went over the toll bridge and through the toll without paying I would be guilty of tax evasion. However, if I go the extra mile and drive outside the city of Washington to the free bridge, I am using a legitimate, logical and suitable method of tax avoidance. And, I am providing a useful social service as well."
Living within the letter of the law is tax reduction, tax deferral, and/or tax avoidance. Pay your taxes, but do not pay more than you are legally obligated to pay!
Asset protection is in your best interest
In protecting your assets you ensure that the assets are used productively by serving your chosen beneficiaries and purposes. In addition you prevent the assets from being used destructively or counterproductively by a wasteful government, or from being taken by the next person playing the litigation lottery. We do not think that paying any more taxes than are required is virtuous or patriotic, but rather is actually a net detriment to the well being of civil society.
Access to higher yield investments available only to offshore entities
As a U.S. person, you are restricted by regulations from participating in many offshore investment opportunities outside the U.S. The United States Securities and Exchange Commission (SEC) imposes a substantial financial and regulatory burden on anyone who wishes to sell investment vehicles to U.S. persons. Consequently most foreign investment opportunities never get offered inside the U.S. But the foreign trust or other entity, for which you may act in an advisory capacity, has access to unlimited offshore investment opportunities including high interest rate bank CD’s, and high return offshore mutual funds and managed accounts. Unlike U.S. persons, foreign trusts and corporations sited in friendly venues can invest in U.S. and foreign stocks without incurring capital gains taxes upon sale. [Disclaimer: We are not investment advisors and do not give investment advice. We do recommend that everyone diversify their investments. This is not a solicitation or offer for an investment. Although there is potential for high earnings offshore, all investment involves risk. That’s R-I-S-K, for those who need it to be spelled out.]
The rules may change but the existence of opportunities will remain
Before examining or implementing offshore strategies a good question to ask is whether changing laws might nullify their effectiveness. There is certainly no shortage of measures, old and new, attempting to do exactly that. The ultimate answer is that we do not know, and we are monitoring the rule changes to see whether we should discard or alter our approach. The following lines of reasoning lead us to expect that the savings and protection provided by the strategies will remain available via some mechanism or other:
1.) While the U.S. Government regards its residents and citizens as captive cows to be milked it cannot be so cavalier with regard to foreign sources of capital. To nonresident foreigners the U.S. is a low tax jurisdiction, and must remain that way to finance our balance of trade deficits. Thus the favorable treatment afforded to foreign entities cannot be summarily withdrawn.
2.) Powerful groups and classes of people and corporations have benefited for decades from the laws underlying the strategies. If their privileged status is to continue, while the pretense that we live under the rule of law with the Constitution as the supreme law of the land remains, then the substance, if not the exact letter, of the laws must stay intact.
Finally, we reiterate that however depressing the prospects for achieving true freedom might look right now, doing nothing is a bad alternative to doing something intelligent. The world is a dynamic place and cultivating a proactive mindset brings benefits well beyond the merely financial.
Who Should Go Offshore?
People who have worked and saved to accumulate what they have and are willing to invest a little effort towards protecting it as well. Specific individuals who benefit from using an offshore structure include:
- People seeking international investment opportunities
- Artists and Inventors
- Holders of copyrights, patents, and trademarks
- Families wishing to establish family and charitable trusts
- Business Owners and Professionals
- People seeking to build an asset base for retirement
- People who prefer to keep their financial affairs private
- People desiring to reduce or defer tax liabilities
- Importers and exporters
- Professionals working abroad
In general, anyone who has accumulated assets worth protecting and developing and does not want to sit around like a sheep waiting to be shorn.
