The document outlines considerations for Indians planning tax-efficient structures overseas, emphasizing the risks associated with aggressive tax planning and HMRC challenges. It provides insights into the Mauritius International Finance Centre, including its economic overview, business environment, and advantages for foreign investors. Additionally, it discusses the Isle of Man as a favorable financial hub, highlighting its legal and regulatory frameworks that benefit family wealth management and corporate structuring.

1. Preferred offshore hubs for Indians
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7th April, 2014

3.  Considerations when planning tax
efficient structures
› Technical input
› Perceived Aggressiveness of the planning
› Risk of HMRC challenge

4.  Planning can be regarded as aggressive
where:
› Off the shelf avoidance schemes are used;
› Where the figures involved are large;
› Where the difference between a tax charge
and no tax charge is:
 the residence of the trust/ company or
 the residence and /or domicile of the
taxpayer

5.  Risk of challenge increases where:
› Income arises or gains accrue to non-UK
resident entities
 Basis of challenge tends to focus on:
› 1. is the trust/ company in fact non-UK
resident;
› 2. possible application of the transfer of
assets provisions;
› 3. possible application of the settlement
provisions or the capital gains tax attribution
of gains provisions

6.  First Step for HMRC is information
gathering:
› In relation to structured avoidance schemes,
 there will have been a DOTAS notification and
 scheme users are required to include the
DOTAS number in their tax returns.
 Therefore HMRC is aware of both the scheme
and the users.
 Scheme users should expect to receive
information gathering correspondence
from HMRC

7.  Where Domicile or Residence is relevant:
› Expect to receive a wide ranging request for
information relating to all aspects of the
taxpayer’s life
 Need to provide all the information?
› The onus is on taxpayer to show that he is
resident or domiciled in the chosen territory
› Therefore, it is advisable to provide
supporting information.

8.  Where offshore structures are
concerned, expect to receive the
standard Transfer of Assets Questionnaire
› This is a document approximately 3 pages
long with requests for broad ranging
information

9.  Do you need to provide all information
requested?
› No!
› Always check the relevance of the
information sought to the tax in issue
› It is VERY IMPORTANT to engage with HMRC

10.  This takes several forms including:
› Responding to HMRC letters
 Response should be:
 Within the agreed timescale;
 Informative where the information sought is relevant
to the tax in issue; or
 Seeking clarification from HMRC about the relevance
of the information sought;
› Agreeing to Meetings
 Go prepared with information;
 Advisory team should attend.

11.  Information Gathering Stage is important
in resolving conflicts:
› Builds mutual trust;
› Clarifies facts;
› Clarifies continued areas of dispute, if any;
› Can assist in reaching an amicable
settlement so that litigation is avoided.

12.  In the event of litigation:
› Early engagement with HMRC will have
pinpointed areas of dispute;
› Litigation at the Frist tier Tribunal is very
important in establishing the facts
 No new facts can be introduced at the later
stages of appeals;
› All persons who wish to give evidence must:
 Provide written Witness Statements;
 Attend the hearing to be cross examined.

13. First Tier
Tribunal
•Appeal on fact and law
Upper
Tribunal
•Appeal on Point of Law only
•Need Permission to appeal
Court of
Appeal
•Appeal on Point of Law only
•Need Permission to appeal

14.  Appeal to the Supreme Court
› Appeal on Point of Law only
› Need Permission to appeal
› Very rare in practice

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16. AGENDA
THE MAURITIUS INTERNATIONAL FINANCE CENTRE
• ECONOMIC OVERVIEW
• DOING BUSINESS ENVIRONMENT
• THE INTERNATIONAL FINANCE CENTRE
By Dhaneshwar Damry
CEO Bhumishq
dhaneshwar.damry@bhumishq.com
The presentation represents the views of the author

17. Star and Key of the Indian OceanEconomic
Overview
Official Language:
English
Area:
2,040 sq km (788 sq
miles)
Population:
1,288,684 (2011)
Population density:
632 per sq km
Exclusive Economic
Zone:
1.9 million km²
+ 396,000 km² joint
extended shelf with
Seychelles
Capital:
Port Louis
Government:
Republic established in
1992.
Gained independence
from
the UK in 1968.
Key Facts
GDP Growth:
3.5% (2011)
Unemployment:
7.9% (3rd Qu 2012)
Inflation:
3.9% (2012)
Repo Rate:
4.9% (as at date)
Legal System:
Hybrid Legal
System

18. Spearheading InnovationEconomic
Overview

19. A Competitive Platform to do BusinessDoing Business
Environment
Occupation Permit
Taxation Land & Property AcquisitionStart Up
Exchange Control
• Start a business in 1
working day
• No minimum
capital requirement
• 100% Foreign
ownership
•Homogenised
15% corporate
tax
• Personal
Income tax at
15%
• Local
government tax
Acquisition of
property
by
non-citizen
Right to Live
and
Work in
Mauritius
Free
movement
of
Capital

20. A Competitive Platform to do BusinessDoing Business
Environment

21. Global RecognitionDoing Business
Environment

22. Global RecognitionDoing Business
Environment

23. Why Africa?Mauritius

24. Government Vision & Strategy for AfricaMauritius

25. WHY MAURITIUS FOR AFRICA?Mauritius
Offerings

26. The Regional Financial Platform of ChoiceMauritius
Offerings

27. The Regional Financial Platform of ChoiceMauritius
Offerings

28. The Regional Financial Platform of ChoiceMauritius
Offerings

29. Access to regional marketsMauritius –
Africa markets

30. Double taxation avoidance agreementsMauritius IFC

31. International Promotion and Protection agreementsMauritius IFC

32. Private wealth managementMauritius IFC
Offerings

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34. The Isle of Man
Financial Centre of Excellence for
Indian Families
Isle of Man

35. Isle of Man

36. Fedelta header
• Close proximity to the UK
• Excellent communications, both physical and
electronic
• Stable Government
• Economic stability and track record
• Government and industry partnership
• Not part of the UK or EU
The Isle of Man
Isle of Man

37. Fedelta header
• Wide range of tools available for structuring
• Globally recognised trust law
• Modern and developing company law
• Government actively promoting the sector
Isle of Man
Legislative Advantages

38. Fedelta header
• Companies 1931 v 2006
• Trusts
• Foundations
• Pensions
• Shipping
• Aircraft
• IT
Isle of Man
The Tools

39. Fedelta header
• Internationally compliant
• Wide range of financial support services
available
• Well regulated corporate, trust and pensions
industry
• Cost advantages
• ‘One stop shop’ advantages
Isle of Man
The Finance Sector

40. Fedelta header
• The jurisdiction
• The infrastructure
• The legislation
• The tools
• The skills
Isle of Man
The Decision

41. Isle of Man

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