Taxation-hedge fund, Financial Management

Assignment Help:

Taxation

In the US, every state has a different set of rules governing the taxation of Hedge Funds and the investors who put their money in them. In some countries, Hedge Funds are taxed in the same way as unit trusts, with income tax due each year on income payments and capital gains tax on profits. However, fund managers should select a tax efficient structure that gives maximum tax benefits to the investors. A Limited Partnership for domestic investors and Corporation structure for offshore Funds in tax haven countries like Cayman Islands, Malaysia, etc., are considered better Hedge Fund structures. Cayman Islands alone accounts for 80 percent of the registered Hedge Funds due to the benefits available in corporation structure for offshore entitiesIn general, the fund manager tries to structure the Hedge Fund, which will result in maximum tax savings to the founders and investors. The parties that are involved in the tax structuring are the investors, the Hedge Fund, the fund management company and the founders. The structure's overall aim is to ensure:

  • No tax burden on the fund;
  • Avoidance of double taxation to investors on investment in the fund;
  • Minimizing tax payments worldwide by the fund management company (or companies or corporations); and
  • Maximizing allowances/relieves from capital gains for the founders.

 


Related Discussions:- Taxation-hedge fund

Determine marginal tax rate, Q. Determine marginal tax rate? Ans. ...

Q. Determine marginal tax rate? Ans. Henkel does not carry debt beyond five years. To determine the cost of debt: a. For Henkel AG, which Treasury rate at which maturit

Explain concept of returns, Meaning of Returns The return from holding a...

Meaning of Returns The return from holding an investment over some period - say, a year, is simply any cash payments received due to ownership, plus the change in market price,

Business proposal of a pet care shop, With the advent of globalization ther...

With the advent of globalization there had been much importance which is being given to the issues related to the general health of pets and other associated services as the people

Operating cycle, applicability of operating cycle in poultry

applicability of operating cycle in poultry

Operating cycle, #questionoperating cycle in vegetable growing business in ...

#questionoperating cycle in vegetable growing business in uganda..

Viability of project - syringe management, The syringe management program t...

The syringe management program tries to educate society by increasing the capacity and quantity of the syringe disposable centers , providing timely responses to all syringe compla

Compute full cost-financially-based rationale , Bill Nicholson wants you to...

Bill Nicholson wants you to help him prepare the financial case for moving the manufacturing operation to Andover.   He has specifically expressed interest in getting answers to th

Define advantages and the disadvantages of a new stock issue, What are the ...

What are the advantages and the disadvantages of a new stock issue? A new stock issue increases funds and reduces the riskiness of the firm. It as well tends to send a negative

Marginal weighting system, uses and limitations of the marginal weighting s...

uses and limitations of the marginal weighting system

Mountain fresh growth, The Mountain Fresh Company had earnings per share (E...

The Mountain Fresh Company had earnings per share (EPS) of $6.32 in 2006 and $11.48 in 2011.  The company pays out 30 percent of its earnings as dividends per share (DPS), and the

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd