“There was no bona fide purpose of the Barbados Spousal Trust other than to obtain the tax benefit,”
“I find the only motivation for this trust was to avoid tax, which would result in more money in Mrs. Antle’s hands. There was no element of estate planning. Mr. Antle could give the shares to his wife, pay the tax, leaving his wife $1.1 million, or he could settle a Barbados Spousal Trust, pay no tax, and leave $1.4 million in his wife’s hands. The purpose of the transaction is self-evident.”
… Canadian Appeal Court Judge Miller
Barbados Trust strategy called “Sham”
Sometimes I can’t understand all the ins and outs of how foreigners set up businesses and trusts in Barbados, but I do know why they do it: to avoid paying taxes back home.
The highest court in Canada has just turned down an appeal of a case involving the setting up of a trust in Barbados – done back in 1999 so a Canadian politician could avoid paying taxes on Canadian profits. Paul Antle transferred the company to a Barbados trust owned by his wife, who would then sell the company, take the profits in Barbados and make a loan to the husband back in Canada.
The tax courts didn’t take kindly to that maneuvering and now the high Canadian court agrees.
So once more our offshore banking and companies industry feels the pinch. We need more tourists ’bout hey…
From the Canadian CBC…
A Federal Court of Appeal judge ruled in 2010 that a trust set up in the Caribbean by the wife of Liberal leadership candidate Paul Antle was a “sham” used to incorrectly shield more than $1 million from capital gains taxes.
That decision went a step further than a previous Tax Court of Canada ruling.
… continue reading this article at the Canadian CBC: Liberal hopeful lost ‘sham’ Barbados trust tax case