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Gibraltar Structures in Wealth Management Prepared by James Lasry Hassans Funds Team

Gibraltar Structures in Wealth Management Prepared by James Lasry Hassans Funds Team. Gibraltar Experienced Investor Funds (“EIF”). Legal framework Financial Services (Experienced Investor Funds) Regulations 2005 ("the EIF Regulations").

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Gibraltar Structures in Wealth Management Prepared by James Lasry Hassans Funds Team

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  1. Gibraltar Structures in Wealth Management Prepared by James Lasry Hassans Funds Team

  2. Gibraltar Experienced Investor Funds (“EIF”) • Legal framework • Financial Services (Experienced Investor Funds) Regulations 2005 ("the EIF Regulations"). • Financial Services (Collective Investment Schemes) Act 2005 (“the CIS Act”). • Rapid establishment • Self-certification and authorisation. • notification to the Financial Services Commission within 14 days of the establishment of the EIF. • Authorised and regulated by the Gibraltar Financial Services Commission. • Experienced Investors • net worth of €1m aside from residential property, • Individuals whose normal business activity includes investment related activity (i.e. investment professionals) or • invest a minimum of €100,000 in the fund. • Service Providers • Two FSC licenced Gibraltar-resident directors required • Gibraltar based authorised administrator • FSC approved custodian (for open ended funds). Can be from any jurisdiction • Annual audit by a Gibraltar registered auditor

  3. Protected Cell Company (“PCC”) • Protected Cell Companies Act 2001 (“PCC Act”). • The Fund can be structured as a Gibraltar protected cell company (“PCC”) pursuant to the Protected Cell Companies Act 2001 (“PCC”). • A PCC is fundamentally a company with limited liability which allows for the legal segregation of assets and liabilities under different sub-funds (Cells). Although a PCC remains a single legal entity, the liability of the company in respect of each cell is limited to the assets attributable to the relevant cell, and it is not liable for the debts of any other cell. • PCCs allows for separate Cells to be set-up with different investment strategies. Investors can invest in just one Cell or in multiple Cells depending on the investment strategies and objectives they wish to adopt.

  4. EIF Protected Cell Company structure Banker/ Custodian 2 Gibraltar Licenced EIF Directors Management shares to be held by the family patriarch / matriarch Other Director(s) Gibraltar Experienced Investor Fund (the “Fund”) Administrator Cell B Cell A Cell C Possibility to create further cells Portfolio Eg. Real estate Portfolio Eg. stocks Portfolio Eg. Private Equity Auditor • Investment Manager /Adviser • eg. • Delegated to a professional investment manager/ adviser • Investment Manager /Adviser • eg. • family office Self-managed by the directors

  5. Advantages of Gibraltar as a funds jurisdiction • EU Jurisdiction • Benefits of AIFMD • Access to EU Parent Subsidiary Directive • European time zone, convenient for: • Investors • Managers • Board meetings • Favourable tax regime • Well regulated • See IMF, OECD, FATF * • Robust and flexible funds legislation • Good infrastructure • Good service providers including accountants, bankers, auditors etc • English-speaking • Common law jurisdiction * See www.fsc.gi

  6. NEW OPPORTUNITIES IN GIBRALTAR INCOME TAX ACT 2010 CHRIS WHITE HASSANS INTERNATIONAL LAW FIRM

  7. 31 December 2010- Options at the end of an era. • 0%/8% System • Across the board low rate • Territorial taxation • Exclusion of streams of income from taxation

  8. Economic Background • Diversity of economy • Growth rate • Debt ratio • Budgetary surplus

  9. Solution • 10% corporate tax rate • Taxation of income accrued in or derived from Gibraltar only • Exclusion of taxation of passive income • No withholding taxes • Lower rates for individuals

  10. Passive Income • Dividends arising from non taxable sources • Interest other than trading interest • Royalties • Bank/others treasury functions • Trust income

  11. Advantages for individuals • 1. Top rate of tax 29% • Reducing rates- income £1m effective rate 20% • Income above £1m charged at 5% • No tax on savings income • No tax on funds income • Pensions charged at 0% • No capital gains tax • No estate duty • No VAT

  12. Advantages for companies • Low tax rate • Territorial basis • No capital gains tax • No royalty/interest taxation • Limited taxation on dividends • No withholding on payments made • EU access

  13. Contact Details for Hassans Contact: Chris White, Partner & Head of Tax James Lasry, Partner & Head of Funds Address: HassansInternational Law Firm 55 Line Wall Road Gibraltar Numbers : Office: +350 200 79000 Fax: +350 200 47303 E-mail: chris.white@hassans.gi james.lasry@hassans.gi Web Site : www.gibraltarlaw.com

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