Invest in your expat child’s future

Carole Hallett MobbsFinancial, Sponsors

Invest in your expat child's future

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Invest offshore for your child’s future

Of all the investments we make in our lifetime, none are likely to be as important as the one we make in the education and future of our children. Wise investment decisions made early on in an expat child’s life can reap huge benefits later and leave you knowing you have secured the best possible future for them.

If you live abroad permanently you could be in a position to take advantage of some very sound investment options that ensure your money is working for the benefit of your children and not just the taxman. Offshore bonds are a tax efficient way of achieving this. Essentially these are portfolio bonds that combine different assets such as stocks, shares and mutual funds with a life insurance policy to create one investment ‘wrapper’.

Tax benefits of offshore bonds

Structuring it in this way has enormous tax benefits for expats. Funds held in an offshore investments bond are able to grow without being subject to annual taxation on capital gains, although withholding tax may apply in certain circumstances. An independent financial adviser will be able to advise you on this. So as your children’s needs change and develop, and education costs rise, your investment stands the best possible chance of keeping pace.

Family life can be full of surprises and one of the major benefits of this type of offshore investment is the flexibility it gives you to deal with them. Within the bond you can buy, manage and sell assets as you need to and make ad-hoc withdrawals if unexpected expenses arise. For ongoing expenses such as school fees it can pay regular amounts into an offshore back account offering facilities such as a cheque book, credit card and online banking. Up to five per cent of the investment amount can be withdrawn annually for 20 years, with the tax being deferred until you cash in the bond.

Defer tax until you are ready to pay

Payment of tax on the withdrawals can be deferred to when you are not a tax payer anymore or when you have moved to a country with lower taxation. You might also plan to leave it until your children have left school and you no longer have fees to pay. For expats there are many other benefits as well. If you sell a profitable fund and buy another within the bond you will not have to pay capital gains tax. And, as the five per cent withdrawal limit is not considered a ‘chargeable event’, there is nothing to report to the UK tax office until one occurs. Your money stays in your control, working for the future of your children.

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Company Profile: Whichoffshore provides professional expatriate information on offshore estate planning, QROPS pensions and more, in order to help British expatriate make the most of their money. For more information, please visit –


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