Is This Legal? How Going Offshore — A Strategy of the Super Wealthy — Can Be Compliant, Secure, and Highly Profitable
Disclaimer: This article can help you get a general sense of cross border wealth options , but it's not a substitute for professional tax advice.
(For TLDR SUMMARY go to bottom of page)
Rise and Grind
Julia was a self-made entrepreneur from the ripe young age of 8, starting with a fruit stand in front of her home. Fast forward to today, she owns two businesses (one operating internationally) and two properties. Being a professional businesswoman is in her blood.
Simply Global CEO, Marley Watkins, discovered Julia, now a mother of two, living in New Jersey and serving as the CEO of a tech company and a staffing firm. With three entities under her belt, she was paying a great deal in taxes. When Marley introduced her to the idea of cross border wealth solutions, she was intrigued yet cautious.
Julia has spent her life growing, defending, and protecting her business and wealth. Her current strategy paled in comparison to the tax savings enjoyed by the super-wealthy. Now, her dreams of creating a legacy and generational wealth for her two girls meant it was time to level up.”
Offshore? Nah..maybe?
Our clients are often simultaneously wary and exhilarated at the word ‘offshore’. We get it. Offshore is a trigger word for many, bringing to mind John Grisham novels and celebrities like Shakira currently facing the music on their tax practices.
How Apple Saved Billions of Dollars by Avoiding Taxes: An Interesting Tale - Startup Talky
Although we want our tax and legal strategy to maximize our advantages using corporate structuring and estate planning, we want none of the smoke and liabilities that come with seemingly too good to be true structuring. Though as with everything in life, information is power. So let’s talk about ways cross border wealth solutions can work to your benefit.
Offshore does not have to mean evasion or manipulation. In fact, done right, exploring cross border options can be a compliant and potentially profitable business practice used by corporate giants like Apple Inc and Tesla. These big players have leveraged their multinational status to create a tax strategy that helps reduce their tax burdens.
How MNCs Shape the World
At SG we like to make our clients MultiNational Corporations (MNCs). MNCs can structure their business to take advantage of hybrid entities, tax-efficient financing arrangements, and other entities that optimize tax outcomes across jurisdictions.
Successful MNCs do this
MNCs give tax advisors the flexibility to strategize in a way that matches their business activities, using local tax benefits like deductions and credits. As tax rules differ worldwide, it is important to stay on top of local laws and global standards like OECD BEPS. Good tax planning means balancing legal and regulatory considerations while being transparent with clients and authorities.
This is what turns you into a global powerhouse. As an MNC, you can set up your businesses to maximize benefits with hybrid entities, smart financing, and other legal strategies to cut down on taxes worldwide.
Julia Spreads her MNC wings
Marley did a deep dive with Julia on all her ventures and interests, prioritizing her goals and values, and finally transformed her business into an MNC with 8 additional entities including a global parent in one of the 13 favorable business locations in the world.
Julia operated in the Philippines and in America and formed a true international parent in a on the Lucky 13 locations. that was able to manage and run all entities. This International parent set up allowed her to gain tremendous profits in fact record profits. Now with multiple tax regimes, Julia restructured to have her headquarters the most favorable of the regimes.
“With this new setup Julia was able to invest 500K capital gains on a real estate exchange with no tax penalty as well as an 85% in tax reduction.”
She was also able to invest into Multiple JVs (Joint Ventures) and segregate personal assets from business liabilities (including potential lawsuits).
What are trusts and why should I use them?
Multinational corporations (MNCs) should think about using trusts because they provide a smart way to protect assets from legal challenges and creditors, especially when doing business in different countries. However, which trust you choose is hugely important. The trusts we use at SG are unique in their protections which allow us to service our clients with peace of mind..
They're also handy for planning ahead—making sure wealth and ownership pass smoothly to the next generation. Plus, trusts can provide tax advisors the flexibility to navigate tax rules globally, keeping things efficient and minimizing tax bills. Some trusts can offer privacy perks, keeping sensitive business details under wraps.
Basically, trusts boost MNCs with a solid strategy for managing risks, generational wealth, and staying financially secure worldwide.
How do offshore trusts protect my assets?
When you set up an offshore trust, you appoint a trustee to legally manage your assets as per the trust's rules. This arrangement ensures strong protection, even if there are court orders or judgments involved. Once your assets are in the trust, they're shielded and no longer considered your personal property.
In some instances, if there's a legal issue in your home country, a local judge may not be able to make a trustee in another jurisdiction hand over those assets. Plus, legal battles between different countries often pause because of the high costs, giving your assets even more security.
Her Happily Ever…
Julia's journey took her to Chesapeake Bay,, where she now lives with her daughters on a beautiful third property. Life threw some serious challenges at them, from the chaos of COVID to a tough divorce and beyond. But Julia's smart planning paid off & her assets and businesses stayed rock solid through all the legal struggles. Now, she's passing on that savvy to her teenage girls, teaching them the ropes of building their own futures.
Her firms are thriving, and the neighborhood is filled with families whose businesses and assets she once aspired to. Julia even has time to enjoy tennis and take trips to the Caribbean with her close-knit crew. Peace of mind and generational wealth? They are ne no longer just goals for Julia—they're her.
Take the next step, become an MNC:
Talk directly to a Simply Global team member on how you can take advantage of offshore solutions and MNCs. Schedule time below to see if you might be a good fit for our offerings.
TLDR
Talking about "offshore" can make people careful and curious. While it's often linked to legal dramas and celebrity tax issues, our approach is about advocating for sound tax strategies and legal planning in lieu of just providing flexibility for tax and legal providers. This is the best way to optimize benefits, and involves utilizing smart corporate structuring and estate planning. It’s important to prioritize transparency and compliance, avoiding risk and most of all, becoming a Multinational Corporation.
For multinational corporations (MNCs) like Apple and Tesla, strategic cross-border tax planning and legal strategy means minimizing taxes while meeting global standards. Using hybrid entities and smart financing, they optimize tax outcomes worldwide. Offshore trusts further assist in smart planning to protect assets to ensure smooth succession and efficient global tax management.