Question Question about CFC & trusted family member

[domperignon]

Reading this explanation of CFC:

Not interested in relocating yourself? Relocate a trusted family member instead. The respective family member can hold shares in a legal way. They can manage your income without bothering about CFC rules and laws.

Relocate someone to the Cayman Islands or perhaps Monaco – you can then continue making money without wasting it on tax. Obviously, the most recommended strategy is relocating yourself. But then, this is not always the case.

Can someone please explain how would this work?

Let's say person A makes money by giving consulting services, and they have a family member, person B, living in Cayman Islands or Monaco.
If person B is the owner of the company, but person A is the one doing the work, wouldn't that trigger some questions from the bank in Cayman Islands or Monaco regarding the business?

 

[Marzio]

Imho it coud work only IF the relation between family members isn't wife / husband but rather brother / sister and you use it as a short term strategy to accumulate some tax free profits while you prepare to relocate otherwise what's the point of having all the profits you earned in the name of a family member if you can't enjoy it?

If person B is the owner of the company, but person A is the one doing the work, wouldn't that trigger some questions from the bank in Cayman Islands or Monaco regarding the business?

According to this logic banks would question Elon Musk because he is not building Teslas himself.

 

[Martin Everson]

Let's say person A makes money by giving consulting services, and they have a family member, person B, living in Cayman Islands or Monaco.
If person B is the owner of the company, but person A is the one doing the work, wouldn't that trigger some questions from the bank in Cayman Islands or Monaco regarding the business?

If by owner you mean company shareholder then it would not trigger anything. This is what the infamous Sir Philip Green did with his business empire in UK. He operated the multi-billion pound Arcadia group while living in UK and stuck his wife in Monaco as shareholder. She got all the dividend income (post UK corporate tax) tax free as a shareholder based in Monaco and all legally. He then buggered off after the collapse of his enterprise onto his yacht...lol

https://www.dailymail.co.uk/news/ar...xes-Monaco-Arcadia-empire-brink-collapse.html

 

[Marzio]

He operated the multi-billion pound Arcadia group while living in UK and stuck his wife in Monaco as shareholder

How he could pull this off? Wasn't his wife considered centre of vital interests in UK?

 

[Jerry1911]

Maybe they weren't married in the UK, weren't married at all or something in that regard...

 

[Marzio]

"Green, her husband Philip, and their children moved to Monaco in 1998, having previously lived on Avenue Road in London's St John's Wood district. Philip Green has said that the move was for health reasons.[9] Tina Green said in a 2005 interview that the couple moved from St John's Wood to Monaco after Philip was the victim of a mugging by three men with a sword."

https://en.wikipedia.org/wiki/Tina_Green
They all moved, not only his wife.

 

[JohnnyDoe]

mugging by three men with a sword."

“Thou churl crossed my path and shall now taste my blade.” That’s how gentlemen deal with such situations, they don’t flee to Monaco

 

[CyprusLawyer101]

The majority of CFC rules make reference to "directly or indirectly" controlling the CFC.