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olwagner, Enrolled Agent
Category: Tax
Satisfied Customers: 36
Experience:  I have 5 years of experience as a credit analyst and 2 years as a tax preparer. I have an advanced knowledge of issues affecting US citizens living abroad.
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Please can you assist me? I am located in Mauritius and am

Customer Question

Please can you assist me? I am located in Mauritius and am establishing a novel investment fund (which will be licenced by the FSC,in Mauritius and we will do all KYC, and due diligence, source of funds, and anti-money laundering checks on all potential investors). The fund is novel, as we have subscribed to various Investment Newsletters in the US, and have developed proprietary in-house software to 'amalgamate' the Newsletters 'picks' of listed securities into our portfolio, classified by conservative, medium or high risk, and also sector, retail, REITS, pharmaceuticals etc. Not more than 3% of the model portfolios will be invested in any one security. The model portfolio we have constructed is a balance of income and capital growth stocks. We understand that there is no Capital Gains tax payable by a Mauritian fund investing in the US through a US Broker (Interactive Brokers) London office is our proposed broker...but my question is mitigate or reduce the 30% withholding tax on dividends upon payments to the Mauritius fund by the listed US corporations what "Treaty Shopping" can be done to identify the most tax advantageous jurisdiction to reduce the withholding tax on dividends paid. When you have identified suitable jurisdictions we will use the Mauritius fund as a 'feeder fund' and incorporate and register and have the fund regulated in the most tax favourable jurisdiction. Also what procedure do we have to undertake to obtain consent to allow marketing of the fund to US Citizens/Residents/Green Card Holders? I look forward to the pleasure of hearing from you in reply, and in the meantime remain, with my best regards.
Submitted: 4 years ago.
Category: Tax
Expert:  Lindie-mod replied 4 years ago.
I'm a moderator for this topic. I've been working hard to find a professional to assist you with your Tax, but sometimes finding the right professional can take a little longer than expected.
I wonder whether you're ok with continuing to wait for an answer. If you are, please let me know and I will continue my search. If not, feel free to let me know and I will cancel this question for you.

Thank you!
Customer: replied 4 years ago.

How thoughtful of you to drop me a line. Thank you.

Yes, it is a concern that having tried your service, and been satisfied with the first response, there is now nobody who can assist me further.

I will sadly have to cancel my subscription, if by Monday morning, no body can answer..... as I am sure you will appreciate .Please do all you can to assist which would be deeply appreciated and respected. I believe your service could be very beneficial to me.

Expert:  Lindie-mod replied 4 years ago.

Thank you for your continued patience. We will continue the search for a professional for you.

Expert:  olwagner replied 4 years ago.
If you want to market to US citizens/ US residents, you'll have to comply with SEC rules. If you can limit your ads to accredited investors, you could viably do that. Else (i.e. marketing to the general public), it would be cost prohibitive.

I don't see how I could help with treaty shopping (it's a very advanced topic).

Also, for that type of question, I think that you'll have to look for somebody who's more of an attorney than an accountant.
Customer: replied 4 years ago.

Thank you for your reply. Do I have to Register the offshore Mauritius Fund in the USA with the SEC if I go the Accredited Investor route? What is the procedure to obtain accredited investor status from the FSC?


I plan to advertise on BBC World News TV Channel on all beams which cover 202 Countries and Territories worldwide. What warning do I need to place to stop the US public (non-accredited investor) from responding to the infomercial? The infomercial will be a call to action style of advertisement which will direct viewers and thus responses to our specific web site for the fund? Look forward to hearing from you, and can you recommend somebody to identify the most tax advantageous jurisdiction for the establishment of the fund to obtain reduced withholding taxes on dividends?

Expert:  olwagner replied 4 years ago.
If your offering is less than $5 million, you can sell it to accredited investors without registering with the SEC. But you still wouldn't be able to advertise.

"Section 4(5) of the '33 Act exempts from registration offers and sales of securities to accredited investors when the total offering price is less than $5 million and no public solicitation or advertising is made. However, Regulation D does not address the offering of securities under this section of the '33 Act."

Else, you will at the very least have to register with the SEC under regulation D.

I doubt that you could advertise on BBC World, even with a Regulation D registration.

It seems plausible that you could on media if you have evidence that most viewers have a net worth of at least $1 million. And direct mailings to people you believe to have $1 million are ok.

But I encourage you to contact a securities' attorney as this is beyond the scope of my expertise.