Eliminate Income Tax on Your Investment Returns

by Peter In regard to income taxes, accounts resident in offshore financial centers are not taxed at source nor do the financial institutions report any income to authorities. Furthermore, offshore financial centers such as Bahamas, Belize, Grand Cayman and the Channel Islands have no income tax whatsoever. There are approx. 45 countries that do not have an income tax, capital gains tax or estate tax! Other offshore financial centers, such as Panama and Costa Rica that do have an income tax, have either written legislation making their international business companies exempt from tax or they allow these companies to earn income tax free if it is earned outside of their country.

Therefore, let us say you have $100,000 invested in Canada and your investment is earning 10% per year (you wish). And, if you’re in a 50% income tax bracket, then over the next 10-years your $100,000 compounded annually becomes $162,889 then your net rate of return is only 5%. On the other hand, if the same $100,000 was invested offshore at a 10% rate of return and a 0% tax rate it would be worth $259,374 at the end of 10-years, an increase of 59%. Stated more emphatically, paying no tax would increase your yield 2.5 times and put an extra $96,485 in your pocket at the same rate of return! Which begs the question – ‘would you rather stay onshore and give the money to the government, or, would you rather be offshore and be able to leave the extra money to your children?

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Created on Dec 31st 1969 18:00. Viewed 0 times.

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