property

Property Holding

Oakfield Corporate Services Ltd. can advise you on how to achieve substantial tax benefits when purchasing a property. With careful financial planning, we can help you reduce your liability to a number of local taxes, such as capital gains and inheritance tax.

The normal strategy when purchasing property is to use a corporate entity, typically an offshore or onshore company, the strategy being that a subsequent transfer of the property would involve the transferring of the shares of the company, as opposed to a transfer of the property itself. The law governing the sale of a property will be the lex situs, or the local law in the jurisdiction where the property is based. So a sale of property located in Portugal, Spain or France will involve local Portuguese, Spanish or French law and the accompanying disadvantages associated with these jurisdictions when selling property, namely, high taxes.

If the property is held in a corporate structure and the sale of the asset involves a transfer of the shares, then the law governing the transfer will be determined by the location of the corporate entity. For example, a the sale of Portuguese property held in a Cayman IBC and which involves the transfer of the shares of the Cayman company will be determined by the laws of Cayman, as the transfer involves the sale of the shares, and not that of the actual property itself.

Choosing a Structure and Jurisdiction

Recent changes to local Portuguese tax laws serves as an ideal example on the importance attached to carefully selecting the proper entity to hold one’s property, whether through an offshore or onshore company, trust, foundation. Of equal significance is the selection of an appropriate jurisdiction to base the holding structure, as the tax and other advantages originally sought could be thwarted if the jurisdiction becomes “blacklisted”, or the laws governing the jurisdiction of the structure that holds the entity does not allow for re-domiciling or the changing of residence of the structure.

N.B. For owners of Portuguese Property held in an Offshore Company, please contact us to find out how we can offer specific solutions tailor-made to your situation.

If carefully planned, the ownership of property in a company or other corporate structure may lead to the following benefits:

1. AVOIDANCE OF LOCAL INHERITANCE TAX
2. AVOIDANCE OF CAPITAL GAINS
3. SAVING OF PURCHASE COSTS
4. EASE OF SALE
5. PROPERTY FINANCE FACILITY
6. PRIVACY, CONFIDENTIALITY AND ASSET PROTECTION

For ownership of property based in any jurisdiction, please contact us to find out about the appropriate structure for your individual circumstances. We are also able to assist with financing the purchase of your property, whether purchased in your own name, through a company, trust, foundation, or other structure.

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