Buying Offshore
Hi all
First post so please bear with me! We have found a villa that we would like to buy but it is Offshore Delaware. Has anyone bought a property this way and what are the pros and cons? Thanks for any advice S |
Re: Buying Offshore
Originally Posted by Crackle
(Post 11771698)
Hi all
First post so please bear with me! We have found a villa that we would like to buy but it is Offshore Delaware. Has anyone bought a property this way and what are the pros and cons? Thanks for any advice S They have had viewers just walk away once the status was made known. Being offshore scares the hell out of some buyers so think ahead. I would get the owners to bring it back on shore to Portugal if they want the sale they will. If they do not find another one. |
Re: Buying Offshore
Thanks EMR. Why are people so nervous? What are the implications I we intend to own long term? Thanks
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Re: Buying Offshore
Originally Posted by Crackle
(Post 11771698)
Hi all
First post so please bear with me! We have found a villa that we would like to buy but it is Offshore Delaware. Has anyone bought a property this way and what are the pros and cons? Thanks for any advice S |
Re: Buying Offshore
Thanks
Has anyone got any facts, figures or helpful advice please |
Re: Buying Offshore
It's a tax dodge; by selling you the delaware company that owns the property, you [probably legally] avoid the property transfer tax, and they [illegally] avoid capital gains tax. But that tax burden is still there waiting for you when you sell it, unless you also sell the offshore company.
This is why the Portuguese tax department frowns on this type of property ownership, and regularly introduces legislation to punish it. As a buyer, your advantages in buying an offshore are likely outweighed by the risks; for one thing, it's very difficult to check that this offshore firm has no hidden debts or tax liens. This sort of thing is for one dodger to sell to another. As suggested above, I'd only buy it straight. But the sellers are unlikely to want to sell under those conditions. In any event, you should get expert professional advice on this sort of thing, because the rules change all the time, and it's complicated all the time. |
Re: Buying Offshore
The US complains about offshore financial centres in Lichtenstein, Switzerland, Cayman, Channel Islands etc. running illegal tax evasion schemes for US citizens, and is now harassing the world into enforcing US tax laws. ...... Meanwhile the US allows Delaware to become one of the world's leading tax evasion and money laundering centres. :rolleyes:
I would recommend being very cautious about anything connected to Delaware because when the music stops you're going to be left holding the parcel, and the contents might not be pretty. ...... You might get a tax bill, or you might lose the property if it was bought with laundered money. :eek: I am not saying either of those are likely, but they are certainly possible. |
Re: Buying Offshore
It is possible to bring the company back onshore - ask whether the seller seller is willing to meet the costs of redomiciliation and subsequent liquidation. Part of the sale price could go into an escrow account until these matters are sorted out, else offer to buy it at a substantial discount. If it has been on the market for awhile, the seller maybe prepared to negotiate.
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Re: Buying Offshore
Seller may be prepared to leave offshore but discount by the potential CGT. Would this make more sense?
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Re: Buying Offshore
There will be costs to dismantle / transfer company onshore - need to discount for this
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Re: Buying Offshore
Stay away from offshore we had a friend and he went ill in uk with cancer he struggle to pay the management bills and the company sign the share certificates over to some one else be careful as he lost the villa
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Re: Buying Offshore
The costs of maintaining an offshore structure are rather high, and in the long term, probably does not compensate for the savings in transfer costs and capital gains costs. If the purpose is to buy and only keep for a short term, then might be worth keeping the property within an offshore structure.
As to the above problem, if the seller is prepared to sell at a price at which the buyer can then dismantle the structure if he wishes, might be worth considering, otherwise pass on the 'bargain'. |
Re: Buying Offshore
Where is the property in algarve as loule are getting stricted on offshore
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Re: Buying Offshore
Originally Posted by morgan1970
(Post 11772847)
Where is the property in algarve as loule are getting stricted on offshore
Obviously louke wants to maximise its tax revenues. |
Re: Buying Offshore
The property taxes are administered by the tax administration country wide. Same rules throughout the country. Might be differences on application but that is due to the local tax administration.
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