Unlocking Offshore Opportunities for Indian HNIs and Family Offices under the new Overseas Investment Regime

“You can never cross the ocean unless you have the courage to lose sight of the shore.”

Christopher Columbus

Columbus’s expeditions in the late 14th century ushered in a period of exploration for the modern world. This has been aptly described as the ‘Age of Discovery’. Centuries later, the allure of offshore opportunities continues to enchant and has grown multi-fold. Today, these opportunities need not be sought out by deploying a flotilla, but require you to simply navigate certain regulatory and global banking channels.

Continue Reading Unlocking Offshore Opportunities for Indian HNIs and Family Offices under the new Overseas Investment Regime

 TO TRUST OR NOT TRUST - MUMBAI ITAT AFFIRMS EXCLUSION OF CORPUS FUND OF OFFSHORE TRUST FROM INDIAN WEALTH TAX

Background:

Creation of private trusts have been considered as a popular method by rich families for succession planning. Trusts are a legal arrangement whereby assets are placed into the care of an individual who manages them for the benefit of someone else. Trust can be further classified into specific or discretionary based on the scheme of distribution of the trust fund. However, in recent times, offshore trust structures are suspected to be more commonly used as a means of money laundering than lawful tax planning. Consequently, the Income-tax Department has been unveiling various private offshore trusts and imposing tax liability on the beneficiary owners. This has led to an increase in reassessment proceedings and dissatisfaction among the residents for being subjected to wrongful tax liability. Recently, the Mumbai Income-tax Appellate Tribunal (“ITAT”) provided relief to Mr. Yashovardhan Birla and held that offshore trusts are considered to be acceptable form of tax planning and a beneficiary of an offshore discretionary trust cannot be taxed on the entire corpus fund merely because he has been provided with the power to appoint/ reappoint trustee. The case is discussed in detail below:
Continue Reading To Trust Or Not Trust: Mumbai ITAT affirms exclusion of corpus fund of Offshore Trust From Indian Wealth Tax