China has developed a five-year plan to turn Shanghai into an international financial hub, relying on a foreign recruitment drive to increase its financial sector workforce by 40 per cent.
Shanghai has long-held ambitions to create a finance district capable of rivalling the likes of New York, London and neighbouring Hong Kong but has struggled with finding enough skilled financial professionals, especially high-level managers and sector specialists.
The news comes at the same time as economists forecast a loss of 27,000 jobs in London's Square Mile by the end of 2011.
According to the "five-year plan for human resources development in Shanghai's financial sector" released this week, China's second biggest city aims to take on 90,000 financial employees, 70 per cent of whom would have a BA degree degree and 15 per cent an MA degree.
This would mean that by 2015 Shanghai would have a total number of 320,000 employees working in finance, if things go to plan. As things stands, less than two per cent of Shanghai's total workforce work in finance, compared to 10 per cent in New York. An improved medical care system, social insurance, and children's education services have been built into the plan in a bid to lure expats who would have previously favoured Singapore or Hong Kong.
A British Expat, who has been running his own education company, in China since 2003 said: "If it has been decreed by the government it will probably get done.
"As China drives towards an economy fuelled by domestic consumption, then they will have the opportunity to put in place huge incentives to make things work for firms that are keeping the money onshore.
"Logistically, Hong Kong was the gateway to China but now China is open, it’s almost superfluous and only has the advantage of the legal system left over from the UK."
Shanghai's income tax rates appear to present the main stumbling block: they are as high as 45 per cent in certain cases. Compared to Hong's maximum of 15 per cent and Singapore's 20 per cent, it means exceedingly generous expat packages will be required to coax financiers across the waters.
Coupled with this is new legislation that will require expat workers and their employers to pay into China's social welfare pot, although it is yet to be made clear exactly how much of their salaries they'll be required to hand over.
When you are working or living abroad, or have plans of relocating into another country, it is very important that you protect you and your family’s health and their wellness.
Expatriates make sure you are covered for International Medical Insurance, April Medibroker assists & advises clients living or working abroad to both choose & place the right international Health and Medical insurance products, to suit their needs & budget.
April Medibroker is here to help you - from the initial advice on what expatriate health insurance policy to buy, through to any assistance that you may need in the future. Our staff are only a phone call or email away. Whether you need changes to cover or payment, need help with a claim or have questions about your international medical insurance policy we will gladly help.
Showing posts with label Expat Finance. Show all posts
Showing posts with label Expat Finance. Show all posts
4 November 2011
31 October 2011
Expat tax exile loses to HMRC in landmark ruling
The Supreme Court has ruled in favour of HMRC and upheld the decision to subject a millionaire expat to UK tax laws despite him spending most of his time in the Seychelles.
While the Lord Justices acknowledged that HMRC's position on how to achieve non-residency "should have been much clearer", a majority of four to one agreed that the guidance informed that in order to qualify for non-residency status, individuals would be required to leave the UK permanently, indefinitely or for full-time employment, and relinquish "usual residence" in the UK.
The solicitor representing retired millionaire Robert Gaines-Cooper immediately issued a stark warning to other expats, saying they too were "at high risk" if they followed official HMRC guidelines as to what constitutes UK residency for tax purposes.
Robert Gaines-Cooper has spent more than 30 years living in the Seychelles but in 2006 HMRC decided that his close connections with the UK, including a large estate in Henley-on-Thames and his regular trips to Ascot, meant that he was both resident and domiciled in his home country, and liable for a backdated tax bill.
He has always maintained he followed the non-residency guidelines set out in HMRC's official IR20 booklet, but after today's decision will now be obliged to pay the backdated tax as well as his legal fees, expected to run into the millions.
Peter Vains, head of tax at the London office of solicitors Squire, Sanders & Dempsey, who represented Mr Gaines-Cooper, said: "He will pay what he is due. It was never about tax but about what was right and wrong. He satisfied all of the guideline terms but the revenue and courts have decided that some additional terms need to be implied in the reading.
"The Supreme Court is the ultimate authority, so one can't complain, but it is harsh."
While the Lord Justices acknowledged that HMRC's position on how to achieve non-residency "should have been much clearer", a majority of four to one agreed that the guidance informed that in order to qualify for non-residency status, individuals would be required to leave the UK permanently, indefinitely or for full-time employment, and relinquish "usual residence" in the UK.
Returns to the UK had to be no more than "visits", while UK property kept by the taxpayer for their use could not be used as a place of residence.
The IR20 will be abolished as of April next year and replaced by a statutory residence test.
Commenting on the case, Sean Drury, partner at PricewaterhouseCoopers said: "With a statutory residence test expected to come into effect in April 2012, the issues at stake in the Gaines-Cooper judgement will soon be of historic interest only.
"However, the Supreme Court's judgment has underlined that international businesses cannot rely on HMRC guidance, only on the interpretation of statute through the courts
"With significant tax costs associated with internationally mobile employees, companies sending employees into and out of the UK would welcome more clarity in managing these costs and for it not to be subject to interpretation on a case by case basis by HMRC.
"With a significant number of enquiries still open into the affairs of internationally mobile employees impacted by this judgment, we hope HMRC adopts a practical approach in closing these enquiries down before the new rules come into effect next April."
When you are working or living abroad, or have plans of relocating into another country, it is very important that you protect you and your family’s health and their wellness.
Expatriates make sure you are covered for International Medical Insurance, April Medibroker assists & advises clients living or working abroad to both choose & place the right international Health and Medical insurance products, to suit their needs & budget.
April Medibroker is here to help you - from the initial advice on what expatriate health insurance policy to buy, through to any assistance that you may need in the future. Our staff are only a phone call or email away. Whether you need changes to cover or payment, need help with a claim or have questions about your international medical insurance policy we will gladly help.
While the Lord Justices acknowledged that HMRC's position on how to achieve non-residency "should have been much clearer", a majority of four to one agreed that the guidance informed that in order to qualify for non-residency status, individuals would be required to leave the UK permanently, indefinitely or for full-time employment, and relinquish "usual residence" in the UK.
The solicitor representing retired millionaire Robert Gaines-Cooper immediately issued a stark warning to other expats, saying they too were "at high risk" if they followed official HMRC guidelines as to what constitutes UK residency for tax purposes.
Robert Gaines-Cooper has spent more than 30 years living in the Seychelles but in 2006 HMRC decided that his close connections with the UK, including a large estate in Henley-on-Thames and his regular trips to Ascot, meant that he was both resident and domiciled in his home country, and liable for a backdated tax bill.
He has always maintained he followed the non-residency guidelines set out in HMRC's official IR20 booklet, but after today's decision will now be obliged to pay the backdated tax as well as his legal fees, expected to run into the millions.
Peter Vains, head of tax at the London office of solicitors Squire, Sanders & Dempsey, who represented Mr Gaines-Cooper, said: "He will pay what he is due. It was never about tax but about what was right and wrong. He satisfied all of the guideline terms but the revenue and courts have decided that some additional terms need to be implied in the reading.
"The Supreme Court is the ultimate authority, so one can't complain, but it is harsh."
While the Lord Justices acknowledged that HMRC's position on how to achieve non-residency "should have been much clearer", a majority of four to one agreed that the guidance informed that in order to qualify for non-residency status, individuals would be required to leave the UK permanently, indefinitely or for full-time employment, and relinquish "usual residence" in the UK.
Returns to the UK had to be no more than "visits", while UK property kept by the taxpayer for their use could not be used as a place of residence.
The IR20 will be abolished as of April next year and replaced by a statutory residence test.
Commenting on the case, Sean Drury, partner at PricewaterhouseCoopers said: "With a statutory residence test expected to come into effect in April 2012, the issues at stake in the Gaines-Cooper judgement will soon be of historic interest only.
"However, the Supreme Court's judgment has underlined that international businesses cannot rely on HMRC guidance, only on the interpretation of statute through the courts
"With significant tax costs associated with internationally mobile employees, companies sending employees into and out of the UK would welcome more clarity in managing these costs and for it not to be subject to interpretation on a case by case basis by HMRC.
"With a significant number of enquiries still open into the affairs of internationally mobile employees impacted by this judgment, we hope HMRC adopts a practical approach in closing these enquiries down before the new rules come into effect next April."
When you are working or living abroad, or have plans of relocating into another country, it is very important that you protect you and your family’s health and their wellness.
Expatriates make sure you are covered for International Medical Insurance, April Medibroker assists & advises clients living or working abroad to both choose & place the right international Health and Medical insurance products, to suit their needs & budget.
April Medibroker is here to help you - from the initial advice on what expatriate health insurance policy to buy, through to any assistance that you may need in the future. Our staff are only a phone call or email away. Whether you need changes to cover or payment, need help with a claim or have questions about your international medical insurance policy we will gladly help.
26 October 2011
Lack of clarity for expats in China around social insurance payments
New laws forcing expat workers and their employers to contribute into China’s social welfare scheme are causing confusion among those expected to pay.
On October 15, legislation came into effect making it compulsory for foreign workers and the companies that employ them to pay a portion of their salary to the Chinese government.
But the hundreds of thousands of individuals affected by the tax-grab still don’t know when payments are due to be made and how the new scheme will be implemented. Typically, when a new Chinese law becomes effective implementation rules are issued shortly afterwards explaining how the new law will work.
However, these rules are not likely to be issued until the end of November and employers are in the dark as to what they will be liable for. The level of contributions is expected to average 11 per cent for employees and 37 per cent for employers. The money will go towards benefits such as pension provision, medical insurance and unemployment benefit.
There are further complications, as the payments aren’t calculated on a unified national basis but vary from region to region. For example, Beijing-based employers will pay 33 per cent while Shanghai-based ones will pay 37 per cent.
There are also local differences on which authorities are removing a salary cap on how much employers will have to contribute for high-earning staff.
Confusion also arises from conflicting reports as to when the payments will be backdated to and how long employers have to make these first contributions. It has been suggested by a quasi-government agency in Beijing (FESCO) that payments will be backdated to July and should be collected by the end of the year.
When you are working or living abroad, or have plans of relocating into another country, it is very important that you protect you and your family’s health and their wellness.
Expatriates make sure you are covered for International Medical Insurance, April Medibroker assists & advises clients living or working abroad to both choose & place the right international Health and Medical insurance products, to suit their needs & budget.
April Medibroker is here to help you - from the initial advice on what expatriate health insurance policy to buy, through to any assistance that you may need in the future. Our staff are only a phone call or email away. Whether you need changes to cover or payment, need help with a claim or have questions about your international medical insurance policy we will gladly help.
On October 15, legislation came into effect making it compulsory for foreign workers and the companies that employ them to pay a portion of their salary to the Chinese government.
But the hundreds of thousands of individuals affected by the tax-grab still don’t know when payments are due to be made and how the new scheme will be implemented. Typically, when a new Chinese law becomes effective implementation rules are issued shortly afterwards explaining how the new law will work.
However, these rules are not likely to be issued until the end of November and employers are in the dark as to what they will be liable for. The level of contributions is expected to average 11 per cent for employees and 37 per cent for employers. The money will go towards benefits such as pension provision, medical insurance and unemployment benefit.
There are further complications, as the payments aren’t calculated on a unified national basis but vary from region to region. For example, Beijing-based employers will pay 33 per cent while Shanghai-based ones will pay 37 per cent.
There are also local differences on which authorities are removing a salary cap on how much employers will have to contribute for high-earning staff.
Confusion also arises from conflicting reports as to when the payments will be backdated to and how long employers have to make these first contributions. It has been suggested by a quasi-government agency in Beijing (FESCO) that payments will be backdated to July and should be collected by the end of the year.
When you are working or living abroad, or have plans of relocating into another country, it is very important that you protect you and your family’s health and their wellness.
Expatriates make sure you are covered for International Medical Insurance, April Medibroker assists & advises clients living or working abroad to both choose & place the right international Health and Medical insurance products, to suit their needs & budget.
April Medibroker is here to help you - from the initial advice on what expatriate health insurance policy to buy, through to any assistance that you may need in the future. Our staff are only a phone call or email away. Whether you need changes to cover or payment, need help with a claim or have questions about your international medical insurance policy we will gladly help.
20 September 2011
Which banks are the safest for expats?
UBS's rogue trader scandal is just the latest incident to weaken savers' faith in banks.
Banks are hitting the headlines for the wrong reasons at the moment. Just in the last few weeks we’ve had the Independent Banking Commission report recommending banks split their traditional and investment banking arms to reduce the risk for personal customers. Then it was reported that Swiss-owned UBS had discovered that a rogue trader had generated losses for the bank of £1.3 billion.
Although savers with offshore banks are covered by protection schemes, if you did want to find out how secure a bank is seen to be you could look at the recently-published Global Finance Review’s list of the World’s 50 safest banks.
But it doesn’t make comfortable reading for UK expats. The ‘top 50’ features just three UK-owned banks or building societies, each of which has offshore operations. It also includes two overseas-owned banks that are significant operators in the UK onshore and expat market.
Spanish-owned Santander, which owns Alliance & Leicester International and Santander Private Banking, both of which are big in the expat market, is assessed as the 10th safest bank in the world. National Australia Bank, owner of Yorkshire and Clydesdale banks, the latter of which has an offshore subsidiary, comes in 12th place. HSBC comes 16th, Nationwide Building Society, 41st and Barclays, 49th.
As offshore savers know all too well, there are a limited number of banks aimed at expats which are actually competing for their deposits. Of those mentioned in the top 50 safest, Barclays seldom troubles the best savings rates table: neither does HSBC, although it does offer some reasonable fixed rate deals.
Clydesdale International does offer one of the best five-year fixed rate deals at 4.15 per cent, and its three-year fixed at 3.75 per cent is a good deal. Its 30-day notice account at 1.25 per cent is also good – although why have a notice account when you can get double that rate on a no-notice deal? Santander Private Banking is aimed at the private banking market rather than ordinary savers.
That leaves Nationwide and Alliance & Leicester International out of the list of the top 50 safest banks with offshore operations. Both offer some good deals on savings, with Nationwide offering the best deal on easy access by an UK-owned bank at 2.4 per cent. Alliance & Leicester has one of the best two-year deals at 3.3 per cent, and equals the Clydesdale at 4.15 per cent over five years.
However, the Global Finance Review report only looked at the 500 largest banks in the world and some of the popular offshore operations fall outside these limits. Skipton International and Co-operative Bank International (and its sister, Britannia International) are keen players in the offshore market. Skipton International’s parent is Britain's fourth largest building society and the Co-op/Britannia are both owned by the members of the huge Co-operative organisation.
There are no Irish banks in the top 50 safest banks. Irish-owned banks are still keen on the offshore market, with three dominating the short-term fixed rate and easy access tables.
One of them will soon be disappearing, however, as the Anglo Irish name goes forever. With effect from September 26, it is being renamed AIB International. The name change comes after Anglo Irish had to be rescued by the Irish government in 2009 and in February this year most of its deposits were transferred to Allied Irish Banks (AIB).
Anglo Irish savers are being reassured by AIB that there will be no changes to their accounts as a result of the name change, although it added that it plans to launch new savings accounts in the next few months "which will be tailored to meet what we believe to be our customers’ requirements".
Anglo Irish has just four currently-available accounts (there are a number of accounts closed to new customers) and all of them are top interest-paying deals. It has the top three-month fixed rate at 2.78 per cent and one of the top one-year deals at 3.3 per cent. It also has the best easy access account deals, with 2.7 per cent on Privilege Demand and 2.45 per cent on Privilege Access.
Deposits in Irish-owned banks are 100 per cent protected by the Irish government until the end of this year, and this includes the offshore operations. There’s also the Isle of Man deposit scheme which covers deposits up to £50,000.
With the Isle of Man scheme (and indeed similar ones in the Channel Islands), the crucial thing is your account is covered if it’s with a bank based on the Island. It doesn’t matter where in the world the ultimate owner of the bank is based.
When you are working or living abroad, or have plans of relocating into another country, it is very important that you protect you and your family’s health and their wellness.
Expatriates make sure you are covered for International Medical Insurance, April Medibroker assists & advises clients living or working abroad to both choose & place the right international Health and Medical insurance products, to suit their needs & budget.
April Medibroker is here to help you - from the initial advice on what expatriate health insurance policy to buy, through to any assistance that you may need in the future. Our staff are only a phone call or email away. Whether you need changes to cover or payment, need help with a claim or have questions about your international medical insurance policy we will gladly help.
Banks are hitting the headlines for the wrong reasons at the moment. Just in the last few weeks we’ve had the Independent Banking Commission report recommending banks split their traditional and investment banking arms to reduce the risk for personal customers. Then it was reported that Swiss-owned UBS had discovered that a rogue trader had generated losses for the bank of £1.3 billion.
Although savers with offshore banks are covered by protection schemes, if you did want to find out how secure a bank is seen to be you could look at the recently-published Global Finance Review’s list of the World’s 50 safest banks.
But it doesn’t make comfortable reading for UK expats. The ‘top 50’ features just three UK-owned banks or building societies, each of which has offshore operations. It also includes two overseas-owned banks that are significant operators in the UK onshore and expat market.
Spanish-owned Santander, which owns Alliance & Leicester International and Santander Private Banking, both of which are big in the expat market, is assessed as the 10th safest bank in the world. National Australia Bank, owner of Yorkshire and Clydesdale banks, the latter of which has an offshore subsidiary, comes in 12th place. HSBC comes 16th, Nationwide Building Society, 41st and Barclays, 49th.
As offshore savers know all too well, there are a limited number of banks aimed at expats which are actually competing for their deposits. Of those mentioned in the top 50 safest, Barclays seldom troubles the best savings rates table: neither does HSBC, although it does offer some reasonable fixed rate deals.
Clydesdale International does offer one of the best five-year fixed rate deals at 4.15 per cent, and its three-year fixed at 3.75 per cent is a good deal. Its 30-day notice account at 1.25 per cent is also good – although why have a notice account when you can get double that rate on a no-notice deal? Santander Private Banking is aimed at the private banking market rather than ordinary savers.
That leaves Nationwide and Alliance & Leicester International out of the list of the top 50 safest banks with offshore operations. Both offer some good deals on savings, with Nationwide offering the best deal on easy access by an UK-owned bank at 2.4 per cent. Alliance & Leicester has one of the best two-year deals at 3.3 per cent, and equals the Clydesdale at 4.15 per cent over five years.
However, the Global Finance Review report only looked at the 500 largest banks in the world and some of the popular offshore operations fall outside these limits. Skipton International and Co-operative Bank International (and its sister, Britannia International) are keen players in the offshore market. Skipton International’s parent is Britain's fourth largest building society and the Co-op/Britannia are both owned by the members of the huge Co-operative organisation.
There are no Irish banks in the top 50 safest banks. Irish-owned banks are still keen on the offshore market, with three dominating the short-term fixed rate and easy access tables.
One of them will soon be disappearing, however, as the Anglo Irish name goes forever. With effect from September 26, it is being renamed AIB International. The name change comes after Anglo Irish had to be rescued by the Irish government in 2009 and in February this year most of its deposits were transferred to Allied Irish Banks (AIB).
Anglo Irish savers are being reassured by AIB that there will be no changes to their accounts as a result of the name change, although it added that it plans to launch new savings accounts in the next few months "which will be tailored to meet what we believe to be our customers’ requirements".
Anglo Irish has just four currently-available accounts (there are a number of accounts closed to new customers) and all of them are top interest-paying deals. It has the top three-month fixed rate at 2.78 per cent and one of the top one-year deals at 3.3 per cent. It also has the best easy access account deals, with 2.7 per cent on Privilege Demand and 2.45 per cent on Privilege Access.
Deposits in Irish-owned banks are 100 per cent protected by the Irish government until the end of this year, and this includes the offshore operations. There’s also the Isle of Man deposit scheme which covers deposits up to £50,000.
With the Isle of Man scheme (and indeed similar ones in the Channel Islands), the crucial thing is your account is covered if it’s with a bank based on the Island. It doesn’t matter where in the world the ultimate owner of the bank is based.
When you are working or living abroad, or have plans of relocating into another country, it is very important that you protect you and your family’s health and their wellness.
Expatriates make sure you are covered for International Medical Insurance, April Medibroker assists & advises clients living or working abroad to both choose & place the right international Health and Medical insurance products, to suit their needs & budget.
April Medibroker is here to help you - from the initial advice on what expatriate health insurance policy to buy, through to any assistance that you may need in the future. Our staff are only a phone call or email away. Whether you need changes to cover or payment, need help with a claim or have questions about your international medical insurance policy we will gladly help.
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