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06
News
Jersey Finance appoints
representative in
Potential tax windfall for holiday
Greater China
Jersey Finance has
home landlords in Europe
appointed
Shanghai-born
Many of the Britons who let out
Example 1
£2,000. This would save Mrs Jones
Zhaoan Li to help
their second homes in Europe
Mr Smith owns a Spanish villa that,
£28,000.
promote the
could now be eligible for a tax
apart from a couple of weeks’
More than two million Britons
island’s Financial
rebate windfall paid back to them
private use, is let commercially
currently own a property abroad,
Services Industry
by HM Revenue & Customs,
throughout the year. Whilst Mr
and a number may recently have
in China and
according to research conducted by
Smith tries to let the property all
become eligible for one of these tax
Hong Kong.
Conti Mortgages Overseas.
year round, the seasonal nature of
breaks. Many owners who
Zhaoan Li will promote Jersey to
Although the most published
the business means that, year on
previously kept their homes for
leading intermediaries, investors, elements of the recent Budget
year, a loss of around £5,000 is
private use have been renting them
regulators and other influential concentrated on tax increases,
incurred. Mr Smith may now be
out to holiday makers over the last
bodies in the finance and business much less publicised is a new
able to make a claim to offset this
couple of years, to generate an
communities in Shanghai, Beijing opportunity for owners of holiday
loss against UK income tax over
extra source of income during the
and Hong Kong.
lets in Europe, who have been given
the last five years. As a higher rate
economic downturn.
Her career in financial services
the chance to apply retrospectively
taxpayer, this would generate a tax
This is a one-off opportunity in
spans 13 years and has included
for tax repayments going back up
sales, marketing and management
repayment of around £10,000 (5
the 2009/10 tax year to secure a
to a full five tax years. But anyone
roles for leading international banks
years x £5,000 x 40%).
unique tax rebate. In 2010/11 the
who thinks they may be eligible
such as UBS Investment Bank,
Example 2
set-off or carry back allowances
should act quickly, as the tax breaks
Commerzbank and Bank of Boston
Mrs Jones acquired a holiday
which create the rebate will no
in London, Hong Kong and
will cease in April 2010.
property in Portugal in 2001 for
longer apply. To be eligible for the
Shanghai. Most recently, she worked
This change in taxation is
the equivalent of £100,000.The
allowance, properties must have
for two and half years at BMO
applicable where either of two
property was let out for five years,
been let for ten weeks a year and
Capital Markets in London where
circumstances has arisen:
on a holiday-let basis, and sold in
available to let for 140 days.
she was responsible for fixed income
1. Where owners have incurred
2006 for £200,000. She paid capital
Editor’s comment: Yet another
sales working with institutional
losses from the letting of the
gains tax in the UK of £30,000 on
example of the importance of
clients in the Far East, including
property since 6 April 2003
the sale, after all available tax
keeping abreast of taxation
China and Hong Kong. In her new
2. Where a property used for
reliefs. It may now be possible to go
changes. The benefits to holiday
role as Head of Greater China
holiday lets has been sold at a profit
back and amend the calculation to
home owners could be substantial
Business Development for Jersey since 6 April 2003
include further reliefs, which would
but it is essential to act swiftly if the
Finance, she will be based in Hong How the rebates work in practice
reduce the taxable gain to around
opportunity is not to be lost.
Kong and travel regularly to other
locations in the region. She is fluent
in both Mandarin and English.
Geoff Cook, Chief Executive,
Jersey Finance, commented:
UBS spurns offshore US tax authority
“Zhaoan Li’s appointment will help
spearhead our increasing drive to
The Swiss financial giant UBS has treaty. UBS argues that a court is
win business in Asia and I am
refused a demand from the not the most appropriate forum
delighted to welcome her to the
American Internal Revenue for the resolution of this matter
team. Zhaoan will help to co- Service to provide the names of and an agreement should be
ordinate visits and will alert the US customers holding offshore reached by negotiation under the
Industry to regional developments accounts. terms of the treaty.
relevant to business opportunities.
UBS stated in court that the UBS has attempted to depict
She will liaise with government,
matter should be handled by itself as the innocent victim of a
trade and regulatory bodies in
negotiation between the two much broader dispute over bank
Beijing, Shanghai and Hong Kong
countries. The Swiss bank secrecy between the United States
and she will progress specific issues
delivered its response to a formal and Switzerland.
which might bring new business to
demand by the IRS to disclose up In February UBS agreed to pay
the island, such as the listing of
Jersey companies on the Hong Kong
to 52,000 accounts as part of the $780 million to settle allegations
subsequently declared a fugitive
Stock Exchange. Having a
Obama administration’s from the IRS that the bank
from justice. UBS said Weil, who
representative on the ground is a
clampdown on American tax assisted in tax evasion.
protests his innocence, left the
valuable addition to our business
evaders. UBS’s court submission
bank to concentrate on his
development strategy in the region.”
Legal and constitutional experts coincided with the revelation that
defence.
Editor’s comment: Last
supported the stance taken by Raoul Weil, the former head of the
Editor’s comment: The latest in
month’s edition of the magazine
UBS, the world's largest wealth bank’s wealth management group,
the long-running battle between
featured Guernsey Finance’s
manager. The bank contends that no longer worked for the
the world’s most affluent society
involvement in the Far East. This
issues relating to details regarding organisation. American officials
and the small European state who
appointment by Jersey Finance is
its US offshore accounts fall had indicted Weil in 2008,
bring a whole new meaning to the
indicative of increasing interest in within the remit of the accusing him of conspiracy in
term ‘banking confidentiality’. This
the region. Switzerland - US double taxation assisting tax evasion. Weil was
contest is far from over.
May 2009 Investment International www.investmentinternational.com
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