Offshore held property warning

biffa · Post by **biffa** » Mon Sep 06, 2004 3:09 pm

As forecast, some of the tax departments have alread "caught up" with the mistakes thay made in calculating the 2003 municipal tax bills. We are now seeing some huge demands arrive wich represnet one half years tax at 5% of the updated ratebale value (the V.T. or V.P.) PLUS the back tax from miscalculations made in respect in the first half of 2003 tax.

My advice to anyone who hasn't made a move yet is to see their lawyer or company manager as soon as possible and move as quickly as possible, probably to Delaware or Wyoming as they are the quickest, even if this is viewed as a short term plan.

There is sure to be a rush at the end of the year and you need to move before 31.12.2004.

Worried · Post by **Worried** » Mon Sep 06, 2004 6:33 pm

Hows about those that have already done the work and moved to safer havens such as Malta, Delaware. Are the tax authorities making any moves to penalise those people?

Naive? · Post by **Naive?** » Mon Sep 06, 2004 7:15 pm

This is probably a very naive question, but what’s wrong with using a company incorporated in an EU jurisdiction which cannot, as I understand matters, be subjected to “punitive” taxes by another EU state?

Guest · Post by **Guest** » Mon Sep 06, 2004 7:22 pm

when i read this I am so delighted to have made the move from offshore into my own name..phew quite a relief

worried · Post by **worried** » Mon Sep 06, 2004 8:25 pm

To Guest,

the decision to move on shore is not at all straightforworward and is dependant on a number of factors and for some there are still some benefits of staying offshore in a safer haven. Howvere if you bitten the bullet and not had to pay over the odds to move on shore then I can certainly see why you are pleased with your decision.

biffa · Post by **biffa** » Tue Sep 07, 2004 8:09 am

Answering the above;

If you have already moved to a safe jurisdiction or came back "onshore" then you should have no worries provided your lawyer/accountant or some person has notified the 3 relevant authorities being Central Registry, Land Registry and local Tax Office. There are no known moves to penalise the jurisdictions mentioned.

Of course a company in any non listed jurisdiction is perfectly usable to purchase property and still does give some advantages over individual ownership.

Last post is correct, the whole thing needs looking at carefully as some options available last year do not exist now and some others do. Take some good advice before you make you move.

Guest · Post by **Guest** » Tue Sep 07, 2004 10:25 am

out of interest what are some of the new bills and valautions like compared to what they were before all this offshore business started?

can you give us any examples ?

biffa · Post by **biffa** » Tue Sep 07, 2004 11:52 am

All properties have been revalued under a "general" scheme and the new value depends simply on when the property was FIRST registered at the Finance Department. Depending on that year they simply multiply the existing value by a factor. For example a house first registered in 1994 would be multiplied by 1.28.

Then if you are onshore you will pay about 0.7% of that value per year in municipal tax but if you are offshore you pay 5%! Eeek - I hear you say!

Worst one we have seen so far is where the value went up from Euros 148,000 to Euros 244,000 and thus the 5% gives an annual tax bill of in excess of Euros12,000. This is a large house in a rural area but not far from the coast.

Problem is it won't stop there. When that house is properly valued under the new system it may reach 80% of market value which would be somewhere near Euros 700,000!

Do the sums!

Offshore held property warning

Offshore held property warning

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