There are lots of ways to invest and you may know that Liechtenstein (with a population of less than 40,000) is one of those countries that provides the opportunity for “offshore investing”. Offshore investment is essentially a decision to defer paying tax until it suits the investor to do so, often when their income or assets or both mean that they do not pay tax at the highest possible rate. You may have read reports that some well-known French have decided to leave their country due to a 75% rate of tax. Be warned though, HMRC have become increasingly concerned about tax evasion and the distinction between tax avoidance and tax evasion seems to be deliberately blurred by Government making advice to use “tax avoiding schemes” considerably more prone to investigation by HMRC.
Liechtenstein has entered into an agreement with HMRC called LDF -or Liechtenstein Disclosure Facility, essentially an initiative to report income to HMRC if it is believed that UK tax is thought to be payable. In short, this is a window of opportunity for those with assets held in Liechtenstein to report their upaid tax to HMRC. In other words, people that know tax is due but have not declared income or assets to HMRC can do so and not suffer the usual penalties for tax evasion (which can include a spell in prison). The window of opportunity closes on 5th April 2016 – so plenty of time for the moment, but I would advise anyone in this position to get on with the process.
This should not be confused with an entirely different opening for a different Lichtenstein, the American pop artist Roy Lichtenstein. The Tate Modern are showing a new exhibition from 21st February and you can now book tickets. Lichtenstein would have been 90 this year. As an investment, Roy Lichtenstein is very collectable, in May last year a piece called “Sleeping Girl” sold for nearly $45m at Sotheby’s in New York. So making sure that you don’t muddle your Lichtenstein with Liechtenstein will make a significant difference to your wealth. If you fancy a look at Sotheby’s in action, there is a significant evening auction in London on 12th February with works by Basquiat, Richter and Bacon.