# Offshore Versus onshore ownership



## Hacker (Mar 19, 2013)

Hind sight is easy but not helpful in solving problems which have evolved due to the ever changing IRS rules on property ownership. When we decided to emigrate to Portugal in 1998 we were advised by a very reputable lawyer that offshore ownership would be the preferred option of holding our home, so we adopted the advice.
We have lived permanently as tax residents in the property which I believe qualifies as our Private Principle Residence but unfortunately offshore ownership excludes capital gains tax concessions in the event of a sale

I feel sure many long term expats must be in a similar ownership situation and faced with the dilemma of selling their property and incurring large capital gains tax liability.

As I stated hind sight is easy and offshore ownership has turned rather sour. I would appreciate any recommendations or guidance on how to unravel the situation and receive an indication of the associated costs. The tax burden of being resident in Portugal compels us to seek an aternative home.
Many thanks


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## TonyJ1 (May 20, 2014)

Hacker said:


> Hind sight is easy but not helpful in solving problems which have evolved due to the ever changing IRS rules on property ownership. When we decided to emigrate to Portugal in 1998 we were advised by a very reputable lawyer that offshore ownership would be the preferred option of holding our home, so we adopted the advice.
> We have lived permanently as tax residents in the property which I believe qualifies as our Private Principle Residence but unfortunately offshore ownership excludes capital gains tax concessions in the event of a sale
> 
> I feel sure many long term expats must be in a similar ownership situation and faced with the dilemma of selling their property and incurring large capital gains tax liability.
> ...


Liquidate and transfer as a dividend in specie


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## Hacker (Mar 19, 2013)

Thank you Tonyj1. Unfortunately I am unfamiliar with in specie transfers but from what I read they are a means of transfering assets rather than cash into pension funds. As you recommend first liquidating the offshore property and then transfering the proceeds as a dividend would it be necessary to transfer to an offshore account or must it be into an ondhore pension fund?


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## TonyJ1 (May 20, 2014)

Hacker said:


> Thank you Tonyj1. Unfortunately I am unfamiliar with in specie transfers but from what I read they are a means of transfering assets rather than cash into pension funds. As you recommend first liquidating the offshore property and then transfering the proceeds as a dividend would it be necessary to transfer to an offshore account or must it be into an ondhore pension fund?


This type of liquidation is specialised and you will need professional help. It is not unique to pension funds, but can be used in this type of problem as well. This will give an indication of the sort of help you should look for. You might be able to save on transfer costs, and obviate capital gains problems. I am not up to date on the requirements and processes, but this can be done.


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## Hacker (Mar 19, 2013)

Thank you again.
After spending several hours looking through accountancy and tax web sites I now have an idea of the complexity of the subject. I will think long and hard about what to do next.
It is good of you to offer advice.
Sincerely,
Hacker


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## TonyJ1 (May 20, 2014)

There is another alternative - redomiciliation of the company to Portugal.


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