Offshore Asset Protection

Offshore Asset Protection

Offshore asset protection is all about protecting someone’s assets outside of his home country. It can also mean assets held inside his home country are not owned by him anymore but by a legal entity registered in another country. That’s where the term “offshore” means, away from home.

Protecting one’s assets offshore is a legal strategy used by thousands of people around the world. The benefits include lawsuit protection. That’s right, protecting assets which include real estate, vehicles, antiques, art work, cash, jewelry, securities, commodities, and other valuable personal properties from civil lawsuits. When someone is negligent or gets into an accident that is his fault resulting in death, injuries, or property damages he can be sued in a civil court of law with a large money judgment being made against him. This can run into millions of dollars depending upon the severity of the injury or damage. Everything he owns is subject to seizure by the injured parties to pay for their monetary judgment. Global asset protection eliminates ownership of these assets which keeps them away from the former owner’s creditors. If you no longer own something creditors can’t seize it. The strategy is to strip the person of everything he owns making him worthless to go after because it will be a waste of time and money. Plaintiffs’ lawyers won’t get paid until they can collect the money judgments because most operate on what is called a “contingency” fee arrangement. That means if he doesn’t find and seize the defendant’s assets he won’t get paid. A debtor who owns nothing is nothing more than a poor pauper making him judgment proof because there is nothing to seize to satisfy the judgment. That is why offshore asset protection is so important in these days of lawsuit crazy societies.

Another benefit is assets can be anonymously owned offering complete privacy to the owner. Some people value their privacy especially when it comes to their financial affairs and will gladly pay for such a system.

Offshore asset protection also offers the benefit of paying lower taxes or no taxes at all. That’s because this strategy spreads ownership on income producing assets amongst several offshore corporations, offshore foundations, or offshore trusts. Some countries tax income on a sliding scale whereby if one entity only earns a small income its tax liability would be less than accumulating all of the assets in one person or one entity creating a higher tax bracket. Spread the wealth and lower each entity’s tax bracket. Elimination of all income and corporation taxes can also be accomplished. The use of entities in totally tax free countries to own all of the income producing assets results in no taxes. To pay for setting up an offshore asset protection plan usually results in tax savings far beyond the set up costs.

There are several structures that can be used for protecting assets. For example, an offshore asset protection trust (APT) can provide a high level of security for personal assets. Those who most benefit from an APT include persons in high-risk occupations (such as physicians and lawyers), business vendors (particularly those close to retirement), those with a high wealth profile, directors of public companies, and almost anyone who has saved a significant nest egg for their retirement.

CS&P provide qualified assistance for setting up effective asset protection strategies.
Please contact us for discussing your needs.

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