Channel Islands firms praised by AIC

Investment firms based in offshore business centres such as Jersey and Guernsey are contributing to the UK economy, according to an industry group.

The Association of Investment Companies (AIC) said that management fees originating from Channel Islands-based financial firms came to around £300 million a year.

Meanwhile, growth in the offshore closed ended investment company sector was shown to be impressive, with the firms raising around £16.5 billion over the past five years.

By way of comparison, their onshore equivalents raised £2 billion.

Daniel Godfrey, director general of the AIC, said: ’The growth of the offshore investment company sector has been a real positive for the evolution of the industry as a whole, allowing the sector to adapt to meet demand for investment strategies which cannot be delivered tax efficiently in the UK.

’But tax efficiency should not be confused with tax avoidance - far from it. In fact returns received by UK investors in offshore funds are taxed in the usual way, involving no tax loss to HM Treasury.’ADNFCR-2318-ID-19220918-ADNFCR