The property market in Mongolia is booming at the moment and a variety of different people are purchasing property in Mongolia. There are no restrictions on who may purchase property in Mongolia.

Offshore Companies have a multiple of uses and purchasing and owning property is a key use for an Offshore Company as they provide an invaluable business service.

There are many jurisdictions where offshore companies are offered. Some of the more mainstream locations are the Channel Islands, British Virgin Islands, and Seychelles and Mauritius. When establishing such an entity, you need to determine which jurisdiction is going to be most suitable for your circumstances and ATC are experts in this field so we will be able to take an overview of your situation and your future intentions to place the ownership of the property purchase.

There are 3 main reasons why an offshore company is used to purchase property.

Safeguarding the identity of the beneficial owner

If you wish to conceal the identity of the beneficial owner an offshore company is a perfect vehicle in order to do this. This is particularly useful when estate planning for investors who have death tax issues to mitigate. The UK has the inheritance regime where UK domiciled residents will be subject to inheritance tax on their worldwide estate. The rate of inheritance tax is currently 40% after the nil band allowance of £300,000. Since the average cost of a house in the UK is around this amount then there is potentially a large tax bill on an average estate of UK resident individual. Therefore if and offshore company is used with non-resident nominee Directors and written into Trust then this potentially large tax bill can be avoided.

Estate planning

By using an offshore company you can provide specific instructions to ATC Solutions in the event of your death as to what should be done with your interest in the offshore company.

Tax Savings

Although there is no capital gains tax on the sale of Mongolian property in Mongolia this does not mean there is no tax on the sale, it will depend on where the person is resident and what are the rules in their country. For example in the UK individuals are taxed on their worldwide income so any capital gain on the sale of a Mongolian property would be subject to capital gains tax in the UK. By using an offshore company capital gains tax is not an issue as the offshore company will not pay any tax on the sale of the property.

Another consideration is the individual could dispose of the company holding the property and therefore this avoids local property taxes in Mongolia also.

There are many other advantages to using an offshore company to invest in property.

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