U.S. gold coins and foreign gold coins are made of the same material. But what currencies are best? It all depends on what you’re looking for. Despite the fact that foreign gold coins and the United States are made of the same material, are not all equal. If we look closely, we realize that not everything that glitters is not gold.

There are many different types of these yellow coins out there, because almost every country mints its own. But not all are.9999% pure. So the selling price of these yellow coins usually depends on the value of the current spot gold and the purity of the coin. So when I buy these precious metal coins, I like to buy the coins are.9999% pure. This leads me to the Canadian Maple Leaves and the Chinese Panda. Their currencies are among the most pure minted today. Its still generally cheaper (on a cost per ounce of gold of.9999%).

The gold coins of the United States remains one of the less pure than the rest of the world. Are only.900% pure. But despite this fact, the most expensive coins are out there (on a cost per ounce of gold of.9999%). So if you are just looking for bullion, coins of the United States are not for you. The United States has activated to.9999% pure gold. But because of this, an ounce cost per.9999% of these coins of the United States rose to an all time high.

If you want investment coins, you should never buy Golden Eagles in MS68 degrees or less. Do not go in value (that is, unless if it is a rare date), but may actually cost more money because of the slab. Not only that, but it is not even.9999% pure. So in this situation, I would have preferred to buy foreign currency a.9999% instead of MS68 Gold Eagle. To invest in gold Eagles, you should buy them in MS69′s / PR69 and MS70′s / PR70′s. You should never buy at lower levels than later. I personally prefer MS70/PR70 grades because they offer the strongest returns.

From the point of view of serious investment, not foreign gold coins would never compare with rare gold coins of the United States. It would not matter if it were a gold a.9999% or graded by PCGS MS70/PR70. The investment is the final rare gold coins of the United States ranked by PCGS and NGC. Despite the fact that they are only.900% pure gold coins of the United States have stronger signals than any other precious metal coins in the world. If you want to invest in bullion, coins will any.9999%. But if you want to seriously invest in precious metal coins, I would suggest to invest in rare gold coins of the United States.

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People who are trading foreign currency are called brokers. They can be working for their own or working for other people who need assistant in doing the trade. Honest forex brokers are the most to look for because they can give you assurance that they will work their best to give you profitable amount of income and also provide the most comprehensive evaluation in your trading business. Anyone can involve in Forex as broker whether he is new or old players in the foreign marketing world. To be able to involve in Forex one needs determination and ready to sacrifice for greater chance to get profit. There are people who offer service to assist company or people in trading currencies in Forex. See online forex brokers reviews to know each broker’s capacity in doing your investment or business.

Avafx is a trading platform which help people to develop their Forex trading. It provide marketers with most comprehensive evaluation of the market condition so that you will be able to make your next move in the market. Here, calculation of the possible income that will be gained by the customers are done by a set of experts consist of algorithmic experts, mathematicians, and trading experts. With minimum intervention, these Avafx experts will help you to make the most out of your currency trading. See Afafx review to know more about this trading platform.

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1. Don’t Forget You Still Have UK Tax To Pay!

Arguably, this is more of a warning than a tip, but it is vital to remember that any UK resident individual buying property abroad is still exposed to UK tax on that property. This may include UK Income Tax on rental income, UK Capital Gains Tax on property sales and UK Inheritance Tax on any foreign properties you leave to your children.

The UK tax burden is often greater than any foreign tax liabilities, so it makes sense to undertake UK tax planning for your foreign property. Many of the same planning techniques that work well on UK property can be used equally on foreign property, although the overseas angle adds an extra dimension and brings both additional opportunities and additional pitfalls to be wary of.

2. Main Residence Relief for Foreign Holiday Homes

There is nothing in the UK tax legislation to say that a foreign holiday home cannot be a UK resident individual’s main residence for Capital Gains Tax purposes.

A holiday home can be treated as your main residence by making an election to that effect, generally within two years of buying the property.

The foreign property must be your own holiday home for at least part of the time but, by making the election, you will be able to exempt some or all of the capital gain on your foreign home from UK Capital Gains Tax.

Beware, however, that you’re only allowed one main residence and, if you’re married or in a civil partnership, you’re only allowed one between you, so electing to treat your holiday home as your main residence could backfire if you sell your main house back in the UK.

You can get the best of both worlds though, if you only elect to treat your foreign property as your main residence for a short period, say a week. How does this help? Well, since every main residence is also exempt for the last three years of ownership, that week buys you three years. In other words, you lose one week’s worth of exemption on your main house but gain three years (and a week) of exemption on your foreign holiday home.

3. Travel at the Treasury’s Expense

If you’re renting out foreign property, you have a foreign rental business. Like any other business, you’re entitled to claim tax relief for your business expenses. That includes any travel costs which you incur for business purposes.

Furthermore, all foreign property rentals are treated as one business. Hence, for example, you could claim the cost of going to Dubai to look for a possible new rental property against the rental income from a villa which you already have in Spain.

4. Understand the Local Taxes

Most countries will tax foreigners on any property they own in the country. Local taxes often apply to property purchases and sales and to rental income. Furthermore, you will often have to pay annual taxes on foreign property, even if you do not rent it out, and many countries also have gift and death taxes.

You will get double tax relief in the UK for any foreign tax on the same income or capital gains when the UK accepts that the foreign tax is broadly equivalent to the UK tax you are paying.

Beware, however, that every country has a different tax regime and not all of them are compatible with the UK tax system. If you suffer a foreign tax which is different in character to any UK tax, or which arises when no UK tax is due, you may not get any relief for it in the UK.

So, a foreign tax at 30% which is deductible from your UK tax liability on the same income may actually cost you less than a foreign tax at 10% for which no double tax relief is available. All these factors need to be considered before you invest in foreign property.

5. Do You Want Double Tax Relief?

As a general rule it is usually worth claiming double tax relief for any foreign taxes whenever you can. By claiming double tax relief, you deduct the amount of foreign tax paid from your UK tax liability.

However, you cannot get any repayment of foreign tax through a double tax relief claim and the best you can ever do is to reduce your UK tax liability to nil.

Sometimes, the foreign tax may actually exceed the amount of the taxable income or capital gain for UK tax purposes. In these situations, it is better to claim the foreign tax as an expense rather than to claim double tax relief.

Where you claim foreign tax as an expense, it reduces the amount of the taxable income or capital gain and can even create a loss. This loss can be carried forward to give you future tax relief and hence, in some situations, can actually give you better value for your foreign tax than a double tax relief claim.

6. Reduce Your Foreign Exchange Tax Risk

All UK tax calculations for individual taxpayers are carried out in pounds sterling. This creates some particular problems when it comes to capital gains on foreign property. You may make very little gain in the local currency, but when you translate your purchase and sale costs back into sterling, you may have a big Capital Gains Tax exposure in the UK.

Let’s say you buy a property in Utopia for 100,000 Utopian Dollars at a time when the exchange rate is two Utopian Dollars to the pound. That means you have a purchase cost of £50,000.

Later, you sell the property for 120,000 Utopian Dollars. In local terms, you have a modest gain of 20,000 Utopian Dollars. However, let us suppose that the exchange rate is now 1.2 Dollars to the pound. This means that your sale proceeds for UK Capital Gains Tax purposes are £100,000 and you have a taxable gain of £50,000.

Maybe that’s fair: after all, if you bring the money back to the UK, you will have made a profit of £50,000 on your investment.

Beware, however, that if you hang on to your Utopian Dollars, they will become a new chargeable asset for UK Capital Gains Tax purposes and may give rise to a capital gain or capital loss when you eventually spend them or exchange them into sterling or any other currency.

The real problem to watch is that if you make a capital loss on your foreign currency in a later UK tax year (year ended 5 th April), you will not be able to set that loss off against the earlier capital gain on your foreign property.

The tax tip here, therefore, is to make sure that you dispose of your foreign currency sale proceeds in the same UK tax year as you dispose of the foreign property itself.

7. Get VAT back with leaseback

In the UK, we are accustomed to the idea that any purchase of residential property is exempt from VAT. This is not the case in every country, however, and many European countries charge VAT, at rates of up to 20%, on new residential property purchases.

One way to recover the VAT on such a purchase is to enter into a ‘leaseback’ scheme. Under these schemes you, the owner, lease the property back to a hotel operator. This means that your property becomes a business property and you are able to recover the VAT. Typically, you are allowed a few weeks of personal use of the property each year and, eventually, after a suitable number of years, it is yours outright again.

The scheme only works for certain types of property, such as hotel rooms and apartments, and may carry disadvantages for other foreign taxes, such as higher Income Tax rates; so it’s one to investigate carefully before you sign up.

8. Borrow to Save

Many countries impose Wealth Tax, Inheritance Tax, or both, on foreigners owning property in their country.

Wealth Tax is usually an annual charge on the property owner’s net wealth in the country.

Foreign Inheritance Tax also usually applies only to a foreigner’s net assets in the country.

In most cases, you can reduce your net wealth in the foreign country for tax purposes by taking out a mortgage on your foreign property. In this way, it will usually be just your net equity in the property which attracts foreign tax.

If you don’t actually need a mortgage, you can invest the borrowed funds somewhere else outside the country where your property is located.

9. Avoid Evasion

When you buy property in a foreign country, you will usually also be acquiring tax obligations in that country. In fact, many countries require prospective foreign property purchasers to register themselves with the local tax authority before they can complete their purchase.

If you want to sleep at night, you need to make sure that you fulfil your local tax obligations in the country where your property is situated. Many foreign tax authorities have the power to seize property where taxes are unpaid.

Naturally enough, the local tax authority will write to you in their own language. Do not ignore this correspondence just because you don’t understand it: this is no defence. You will need local help and advice to make sure that you deal with the local tax authority appropriately and meet all of your obligations as a taxpayer in the country.

10. Expect the Unexpected

If the UK tax system is all Greek to you, or seems like Double Dutch, why should you expect foreign taxes to be any different? Every country has its own tax and legal system and, when you buy property abroad, you must abandon all of your preconceptions.

Assume nothing until you have investigated the local tax system thoroughly. Your destination country will have different taxes, different tax rates, a different tax year and a whole different set of rules, regulations, reliefs and exemptions.

Local property law and succession law is likely to be different too and a UK investor who overlooks this fact may suffer a great deal more than just tax!

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When it comes to expanding your business overseas, franchising has become the Modus Operandi of the day. In Singapore, many businesses including restaurants, café chains and fashion chains have shown interest in and considered setting up overseas franchises. It makes sense financially for them in the sense that the franchisor (the business owner that grants the franchise) can charge an initial fee to the overseas franchisee (the person who takes the franchise). Franchising in effect provides an almost cost-free expansion since the original business receives royalties and a constant stream of income from the franchise. But there are pitfalls to avoid. Franchising may not be suitable for all businesses and an overseas operation can fail for a number of reasons.

This article sets out briefly some of the challenges a franchisor venturing overseas may face and how to overcome and resolve them.

Franchise Systems

Companies that wish to enter into a franchise agreement should familiarise themselves with the franchise system. There are three different ways to operate a franchise:

Unit franchise:

The business owner allows only one franchise outlet, and licenses all trade marks and other proprietary rights to only that one outlet.

Area franchise

The franchisee is only allowed to operate under the trade mark or brand name in one designated geographical area, such as the province of New South Wales as compared to the whole of Australia.

Master franchise

The franchisee is entitled to operate in the whole country, sometimes with a right to create sub-franchises and appoint sub-franchisees within the country.

Costing would differ for each of the above types of franchises and is also affected by the potential market size and share in the targeted country.

Regulations and Other Legal Issues

The next things to look out for when considering whether to franchise are the laws and local regulations in the targeted countries, which will impact on the franchisor. In countries such as the USA, the franchisor must comply with stringent disclosure requirements while in countries like Indonesia, the franchisor may be required to register the franchise agreement with the relevant authority before commencing operations. These requirements do not really present too much of a problem to the franchisor, but they have to be complied with nonetheless. The franchisor should also pay particular attention to laws and regulations in various other countries that directly affect the business of the franchise. One example of what we mean here is that, since February 2005, franchising has not been allowed in China for foreign retail brands which do not have a minimum of two shops and more than one year of operations in China. This amendment to the franchise regulations has made it difficult for established local brands to franchise to China.

Of course there are perfectly legal solutions to avoid the problems that may be encountered. The rules differ from country to country and, therefore, any prospective franchisor must seek legal advice when venturing into a foreign jurisdiction for the first time to ensure that all such regulations and formalities required under the laws of the targeted country are complied with.

Of course in some cases, it may still not be advisable to commit to a franchise agreement even though all the indications are positive. Some product lines may simply be unsuitable for franchising.

Common Problems Faced by Franchisors

There are a range of problems that could be encountered by franchisors and we have attempted to address the most common ones here.

Initial Investment

One of the problems when embarking on a franchise, especially for local companies or SMEs (small medium enterprises) seeking to expand overseas, is the costs involved in the early stages of a franchise. Preparation for franchising has to be done without the guarantee of payment and collection of franchise fees and royalties in the short term. The costs involved include:

• developing the franchise concept (normally done with the help of engaging external consultants)

• overseas market research

• legal matters

• providing support

• looking for suitable franchisees

• training

• product costs

• supply of products to the franchisees

For retail chains, financial problems with shipment and manufacturing (even after executing an agreement with the franchisee) have to be considered. The sizable initial costs plus the time lag (about half a year to more than one year for preparations) before the franchisor can recoup the money from the franchisee, may result in cash flow problems for the franchisor. This is especially so for smaller retail chains with a yearly turnover of say US$1m to US$5m as they may not have the financial resources to provide or compensate for any delays.

One example we experienced that illustrates this point is the case of a Singapore shoe retail chain (with about 5-6 shops) which embarked on a franchise for its shoe retail chain in Indonesia. In the contract, it was stated that the balance of payment would be paid after the goods had arrived at the Port of Jakarta. However, the payment was not made. Despite this, the franchisor had no alternative but to release the goods as they were already in the Port of Jakarta. He only received payment at a time much later than the agreed date. This delay caused him some cash flow difficulties.

Problems like this can and should be addressed legally in the franchise agreement just as they would be in a contract for international or cross-border sales of goods.

Financial concerns can also lead to the lack of adequate preparation in coming up with the franchise concept. This can, in turn, lead to inconsistency in the quality of the products and different levels of support or commitment by the franchisor in different countries. The food in a franchise outlet in say, Australia, where the franchisor is located, would taste much better than those in another outlet from the same franchise in China. Though the situation may improve after some time, this is the usual problem that local brands or small medium enterprises face at the onset.

The Trade Mark Problem

Usually, trade marks are the most important intellectual property rights in a franchise. Trade marks are territorial in nature and the franchisor will have to register its trade mark in the targeted country before it can be protected there. Registration in your own home country is not good enough and your local registration will not be recognised in another country.

The franchisor may sometimes find that his trade mark has already been registered in the targeted country by a local third party as was the case with a particular popular Indonesian fashion brand seeking to franchise in Korea and Thailand. It found out the hard way about stolen trade marks when it discovered, after entering into a franchise agreement with a local franchisee, that its own brand name had already been registered by other companies in these countries. To make matters worse, it decided to leave these issues to the local franchisee instead, thinking that the local franchisee would be more familiar with the situation. This caused him serious financial losses as he had already shipped his products to the franchisee. The franchisee subsequently defaulted on payment and did nothing to resolve the trade mark problem. From this it becomes clear that some initial market research in the targeted countries and legal advice are needed when you want to start your franchise.

Registering Your Trade Marks in Foreign Countries

The Madrid System for the International Registration of Marks (“Madrid Protocol”) and the Paris Convention for the Protection of Industrial Property (“Paris Convention”) are two very important international treaties regarding the registration of trade marks.

The Madrid Protocol provides a one-stop filing system so that the franchisor can file for trade mark protection in his own country as well as his targeted countries at the same time. It does not give you an international trade mark that is recognised by all its member states or all countries across the globe, but provides a convenience of filing in different countries at one go and also reduces the costs of filing.

The Paris Convention on the other hand, provides a very useful mechanism allowing the franchisor to file the trade mark in his home country first at an earlier date and subsequently, within a given time frame, when he decides to file his trade mark in his targeted country, he is able to claim priority or use his first and earlier filing date in his own country as the date of filing in the targeted country. The Paris Convention gives the franchisor time to source for funds before filing for trade mark protection in the targeted countries and the peace of mind that comes with knowing that he can be protected by filing first in his home country.

Take a real-life example of a Korean cosmetics company setting up its business in Singapore. It registered its trade mark first in Korea sometime in December 2005 before coming into Singapore. Upon entry into the Singapore market, it then filed for trade mark protection in Singapore under the Paris Convention sometime in March 2006. However, the directors quickly received notification from the Singapore trade marks registry that there was an identical trade mark filed by their competitor in January 2006. Taking advantage of the Paris Convention, the Korean company was able to claim the earlier filing date in Korea of December 2005 as their date of filing in Singapore and this allowed them to effectively override their competitor’s earlier application. This helped prevent a situation where the Korean company would either have had to shelve its plans in Singapore or embark on costly litigation to recover its trade mark.

In general, it is usually not advisable to leave trade mark matters such as registration to the franchisee. The trade marks should always, where possible, be filed in the name of the franchisor otherwise the brand value or recognition of the trade mark may be diminished in the long run since the public in the targeted country may come to identify the trade mark with the local franchisee and not the franchisor.

Other Intellectual Property Rights

Copyright

This is another form of intellectual property rights which may be of interest to the franchisor. Copyright can attach to many possible mediums and is not confined to brand or logos alone. Instructional manuals, business forms, software and other items may all be protected by copyright. Unlike trade marks, copyright usually does not have to be registered and can be protected in many foreign countries at one time if these countries are all signatories to the same international copyright convention.

Patents

These do not quite fit into the business model of franchises since patents are, by their nature, confined to subject matter of heavy industrial application. This may change in the future as many countries such as Singapore have made or are making changes to their laws, allowing business methods to be patented. Like a trade mark, a patent has to be registered and have its own equivalent of an international system of registration by way of the Patent Co-operation Treaty. The Paris Convention also applies to patents.

Control over Franchisees

It is always advisable to exercise some supervision and control over a franchisee. The first step towards this is to incorporate the right clauses in your franchise agreement at the onset. The franchisor should insist on some form of reporting requirements and a right to inspect accounts. There should also be some provisions to safeguard the franchise concept and sometimes the franchisor’s business methods. Generally, the franchisor should be looking to protect, by way of contractual clauses in the agreement, what may not be protectable under intellectual property laws.

This helps the franchisor to prevent a situation where the franchisee acquires knowledge, copies the franchise concept and uses this to compete with the franchisor. This can sometimes happen at the end of the franchise period. Basically, there should be restrictions imposed on the franchisee when dealing with materials or other property of the franchisor, and these should be returned and accounted for by the franchisor upon the expiry or termination of the franchise.

See You in Court – But Which Court?

It may be at times necessary to take legal action against an errant overseas franchisee that is outside the jurisdiction of the courts and also beyond the control of the laws in the franchisor’s home country.

It is advisable to make some provisions for this in your franchise agreement. The two important considerations here are the place to sue and the law to apply. It is important to seek legal advice for these matters since your choice of place and law often determines success and directly affects the prospects of recovery as rules may differ from country to country. Some countries may have bilateral reciprocal enforcement regimes allowing their respective courts to recognise and enforce each other’s judgments while others may be signatories of international conventions to the same effect. It is important to know these in order to choose your place to sue and the applicable law.

Sub-Franchising and Exchange of Goods

Another problem with franchising is the inconvenience caused to end consumers when it comes to the exchanging of defective products. This is especially so where there is sub-franchising created in different places in the same country. For instance, in Australia, when a customer buys an item of clothing from an outlet in Sydney, he would not be able to exchange it in the franchise in Melbourne. This also happens in Indonesia, especially if the shop is owned by different people. That is why some retail chains like Hammer and Nail (Indonesia) prefer to own the business themselves. This can be used either as an alternative or a stepping stone to establishing a fully fledged franchise.

Raise Public Awareness First

It may be easier for local brands who want to expand overseas by franchising to consider setting up their own flagship store in the overseas country first. This would raise public awareness of their brand and product in the targeted country and help to attract more franchisees later on. Famous local brands such as BreadTalk in Singapore may not be known to anyone in overseas countries, such as Germany. As such, potential investors in Germany would be hesitant to invest in the brand. By setting up a flagship store, the franchisor can test the local market.

However, before venturing overseas, research should also be done on consumer behaviour to make sure that the consumers in that country would appreciate the product, bearing in mind that different countries have different cultures, tastes and market trends.

Franchising –

A Great Tool for the Right Business with the Right Knowledge
Franchising is a useful tool when it comes to expanding your business overseas. However, as we have shown here, there are also potential pitfalls and risks involved. This can be avoided or at least minimised if the necessary preparatory work is carried out before you venture into a franchise agreement with a foreign partner.

Acquiring knowledge of consumer behaviour patterns, local market conditions and regulations, developing a suitable franchise concept as well as paying attention to various details in your franchise agreements are just some of the more critical matters that you, as franchisor, should take note of.

Knowing your market and your rights as a franchisor or a trade mark owner lays down the foundation for the creation of a successful franchise.

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