HEADLINES [click on headline to view story]:

Family Money

Personal Directions

The Doctor's Consultation by Dr. Iain Corness

Agony Column

Camera Class by Snapshot

Recipes from Rattana

Ask your local US Consul

Family Money: Leaving it all behind you - Part 1

By Leslie Wright,
Managing director of Westminster Portfolio Services (Thailand) Ltd.

Whenever the thorny subjects of estate planning and inheritance tax are raised, many clients respond with a shrug and the blithe comment that they don’t give a fig what happens to their money after they’re dead. If only it were as simple as that.

With property prices in Britain at record levels, and Chancellor Gordon Brown in his Budget 2003 speech in April having raised the inheritance tax threshold by just 2% to ฃ255,000, an increasing number of people are falling into the UK inheritance tax net.

Your family home in UK - as a ‘principal private residence’ - may be exempt from Capital Gains Tax (‘CGT’), but it could easily push the value of your estate into the Inheritance Tax (‘IHT’) bracket.

IHT is charged when assets are transferred from one person to another or into trust. Usually, the charge is levied on the estate when someone dies, but it also applies when assets are gifted during one’s lifetime.

It all depends on domicile

Whether someone falls into the UK IHT net - be they a British resident, a UK expatriate living abroad, or a foreign national resident in the UK - all depends on their domicile.

As I have written before, many British expatriates think that by virtue of their non-residence in UK they have protection against UK IHT, but this is not the case.

If they are UK domiciled and live overseas, when they die they will be subject to IHT on their worldwide estate unless they have gone to great lengths to change their domicile.

Anyone not UK domiciled but with property or assets in the UK will be taxed only on their UK-based assets.

Many people confuse domicile with residence, but domicile is not just about where you have your home, it’s much more tenuous than that: it goes to state of mind. Domicile is difficult to change unless you settle in a country with the intention of remaining there permanently and even then, there are no hard and fast rules. The matter is finally decided by the courts only after you’ve died - and of course it’s too late then for you to do anything about it.

Changing the rules?

For many years the UK government has talked about reforming domicile laws, mainly in an attempt to end the favourable basis of taxation for foreign nationals resident but not domiciled in the UK. In this year’s Budget, there were no concrete changes announced, although a background paper was issued inviting responses.

A change in domicile rules is likely at some point. Such a reform would be designed to catch wealthy foreigners in the UK, whereby after a few years in the UK - perhaps five or ten - foreign nationals will be deemed UK domiciled. This might similarly benefit UK domiciled people living abroad. At present, however, it is not easy to shed one’s domicile - hence IHT liability. What is easier is to reduce that liability.

Fortunately, IHT is not taxable on an entire estate. The first ฃ255,000 of assets is exempt: called the ‘nil rate band’. After ฃ255,000, IHT of 40% is chargeable on the balance, which could trigger a large tax bill. For instance, if someone has assets worth ฃ500,000, the first ฃ255,000 is tax free but they would have to pay ฃ98,000 IHT on the balance.

Inheritance tax now affects more people than ever before - partly due to the dramatic rise in house prices in recent years.

The smaller the better

How can you reduce your IHT liability? Fortunately, if you do your planning early enough, there are a number of ways in which you can manage your liability. These include making gifts, making transfers using a will, and making transfers into trusts. It’s essential that you take advice, though, as setting up wills and trusts requires financial expertise.

Most IHT planners agree that the first thing a client should do is to ensure their estate is as small as possible by giving away their assets.

Making gifts

All sorts of bequests carry tax exemptions. When gifts or transfers are made by individuals - whether directly or into certain types of trusts - they are treated as Potentially Exempt Transfers (‘PET’s), which are a useful way of gifting assets during a lifetime without incurring IHT provided you live for seven years after making them. If death occurs before then, IHT is charged subject to taper relief and the nil rate band.

There is a way to use this exemption, though, and retain flexibility over when the gift is made: setting up a gift trust and transferring the gift into it. You can then choose to vary the beneficiaries, the amounts given and when they benefit. It’s a simple plan for people who aren’t yet ready to give, but want to make the most of exemptions during their lifetime.

Smaller gifts that you are ready to make can be kept tax-free using the annual gifts exemption: this allows individuals to give away up to ฃ3,000 a year and married couples up to ฃ6,000 a year, as well as any number of individual gifts of no more than ฃ250. No IHT is charged either on marriage gifts up to ฃ5,000, gifts to charity or to recognised political parties.

(To be concluded next week…)

Personal Directions: Challenges and obstacles fuel our existence

By Christina Dodd,
founder and managing director of Asia Training Associates

This week I would like to share an article with you that came to me through a reader in the States. The article is by John & Melody Anderson and I think you may find it an interesting read. It deals with the subject of challenges and obstacles in life and brings to light the reality of their place in our existence.

Rocks (March 1996)

We employ the use of an analogy here to demonstrate the requirement for challenge in life and to show that without obstacles in life, much of the enjoyment we get from overcoming these obstacles, and thus our purpose, would be lost.

The world is filled with rocks of all shapes and sizes. Some are large, some are very small, some are immovable and some are not. Yet the rocks that prove to be the most significant obstacles are those that do not exist. Invisible non-existent rocks can be hazardous. They can cause mild abrasions when walked into by an unsuspecting pilgrim. They can inflict rather more serious injuries if the pilgrim is running or moving at considerable speed. And if a pilgrim is endeavoring to clear an area for planting, invisible rocks continue to surface, usually it seems, when the pilgrim is making the most progress. Just as an area seems to become clear, more rocks appear, apparently from nowhere and the pilgrim must begin all over again. This would seem to frustrate the pilgrim who is eager to expose a clear space so that they can build, but until such time must continue to struggle with multiplying rocks.

Little does the pilgrim know that the multiplication of those rocks is crucial to the fulfillment of their initial vision for the piece of land. Commonly, pilgrims misperceive this vision and incorrectly assume that the vision is a piece of land devoid of rocks and stones upon which something may be built. Just what this is, however, remains somewhat of a mystery.

The part of the assumption that is incorrect is that the vision is a piece of land devoid of rocks and stones. In fact, it is more correct to hypothesize that the vision is the rocks and stones and indeed the moving of them. It is the interrelationship of these elements that defines such a vision. Move and dispense with the very last rock and stone and the body stagnates, the mind remains unchallenged and what the pilgrim is left with is very little reason to exist at all.

Imagine a world without rocks and stones. Bliss the pilgrims cry. But no, far from it. Imagine again, what then is the substance of the vision? What gives the vision its special appeal?

For the pilgrim who seeks greatness the secret is finding peace amongst the rocks, moving what he can, developing strengths and skills to move what he cannot and greeting the emergence of other rocks and stones with equal relish.

Many of the pilgrims who seek greatness play a waiting game, ever hopeful of one day arriving at that glorious moment when the final rock will be gone from the land and life can be easy at last. Rather misguided is the pilgrim who plays this game, for their joy can only come from an end result and an impossible one at that. The pilgrim who prospers is the individual who is prepared not only to move rocks and stones consistently, but whose love of life does not depend on the absence of the rocks.

In fact, the pilgrim relies on these rocks to satisfy the achievement of their vision. For the vision is not a thing, or even a series of things, nor is it a particular combination of circumstances in an individual’s life. Achievement of the vision relies on the interrelationship between individual and rock. In exercising this interrelationship, a way of being is expressed and this way of being either aligns with the vision or directly opposes it.

The vision then, crucial to fulfillment in life, is a way and the expression of that way in action. This dynamic relationship is self-perpetuating, for as the pilgrim grows in strength, so too, grows that which they desire and in so doing, new challenges are brought forward - and in expressing the way, the pilgrim has cause to further desire and so on. All the while, the love of moving and exposing rocks sustains the pilgrim’s requirement for joy and becomes the ultimate reward in life. (end article by John & Melody Anderson)

Rocks are our greatest motivators. With them in our lives we find the inspiration to go on. Without them life does not reach the levels of fulfillment that we so strongly desire and need to live.

A simple analogy and a very powerful one at that. Take some rocks and find a space for them near to you and use this as a quiet reminder of the need for us to have challenges and obstacles jump out at us everyday. Just as we need to be confronted by problems and concerns to keep us alive and awake and thinking, we need the constant state of Rocks.

I once took a group through a session that looked at the question, “What is a problem?” They were asked to split up and ponder this question and come up with an answer. It wasn’t until they sat down and thought about it that they really began to understand that their lives were filled with problems every moment of the day - for a reason. Obstacles and sometimes unbearable struggles present themselves at what appears to be a steady and endless stream - for a reason. We are not meant to just breeze through life for if we did, where would be the rewards?

Words are such powerful tools aren’t they. Challenges and obstacles equally so. I hope you have enjoyed the article and until next time, have a great week!

For any information you may require on personal development training programs or professional and business skills development, please contact me by email at Christina. Dodd@atasiam.com and if you have a moment free, take a look at our website www.asiatrainingassociates.com

The Doctor's Consultation by Dr. Iain Corness: The grumbling appendix - are you next!

by Dr. Iain Corness

A “grumbling appendix” is a very common condition, and the ultimate cure is removal, called Appendicectomy (if you come from the UK or Australia) or Appendectomy (if you come from America). The condition is simply inflammation of the appendix, which we medico’s call appendicitis (remember that “-it is” at the end of the word usually means inflammation).

The appendix is a little “finger” shaped appendage that hangs off the bowel and connects with it. It lives down in the right hand lower side of your belly, so that is where you get the pains. Ruminants such as cows have large ones, if size really matters! For us, it is also one of those cute “vestigial” organs which has no apparent functional use these days, but can give us lots of problems if things go wrong. And things often do go wrong, with appendicitis being experienced by about 1 person in 500 every year. Males suffer from this more than females and it can strike at any age, though under two is exceptionally rare. The most affected age group is between fifteen and twenty-four.

So what causes appendicitis? It is a form of infection which is generally from the food passing through the bowels and can be bacterial or even viral. Sometimes the poo (nice medical term) in the intestine gets jammed into the appendix and causes the initial problem. Just for the record, we call it “inspissated faeces”, just to make it sound grander than it really is.

While the signs and symptoms of appendicitis are straightforward, the diagnosis is not so easy as a number of other abdominal conditions will mimic the symptoms of centro-abdominal pain which radiates to the right lower side, nausea, low grade fever and occasional diarrhoea. There is also the problem that the signs and symptoms can come and go - that’s why it is sometimes called a “grumbling” appendix. From my medical student days I can even remember the last ailment in the list that could mimic appendicitis was the abdominal crises of Porphyria! I must admit that in 35 years of medicine I’ve never seen one!

There are some laboratory tests which can be done, especially a blood test to see if the white cell count has gone up, and some centres will perform ultrasound to try to differentiate what is going on inside the belly.

The definitive “cure” is to whip out the offending organ, and this is usually one of the first operations a young surgeon does on his own. (Mine was a Russian seaman in Gibraltar and I think I was much more worried and apprehensive than he was, but then, I knew how inexperienced I really was. He didn’t!)

My old surgical boss always told me to make sure the skin incision was as small and as neat as possible, because that was all the patient had to go by to judge one’s competency. It didn’t matter what went on inside - just make sure the outside looked good! This was particularly important with young females and a 1 cm scar, level with the top of the bikini bottom was the ideal.

Post-operatively the vast majority of patients do well and are up and about in a few days, happily living without their appendix, but if you’re having some grumbling gut pains, perhaps you should let the doctor cast his practiced eye over it.

Agony Column

Camera Class: Don’t become blinded by familiarity

by Harry Flashman

A few weeks ago I wrote about getting a different viewpoint on the subjects you photograph - this week I am suggesting you find some different views as subjects. As a serious photography project, this is one time you do not need wide angle lenses, special filters or off camera flash guns. Any old camera will do - even the disposable ones! And you will get photographs that will keep your friends overseas interested and green with envy. Guaranteed!

So where are these earth shatteringly different subjects? Actually, they are all around us. You see, living in Thailand, we have a wonderful opportunity to photograph subjects which are totally beyond the reach of the average photographer in the US, UK, or EU. There is only one problem in recognizing these. It is called familiarity.

Think back to when you first came to this country - a Thailand newbie. Everywhere you went you saw something different, something new, something totally off the wall, something hysterical, something crazy and something totally appealing. Now after a few years you don’t see anything like that any more. Why? Because you have become too familiar with the everyday, but still incredible, sights in this country. They have become commonplace. Four people on a motorcycle - see that every day in America? Never. A dog in the carrier of a bicycle. See that in England? Never. Somebody walking down the street in the rain with a plastic bag on his head? See that in Germany? Never. A motorcycle with a banana leaf as a rear mudguard in Maine? Absolutely never. Those incredible sights are still here, but you have forgotten how incredible they are.

Now even if you personally have decided to live your life out in Thailand, you will still have relatives and friends back in your own countries who will be as awed as you once were when you saw Thailand for the first time. It is your responsibility to pass on that magical feeling to the ‘folks back home’. And the best way is with a photograph - as they say, a picture is worth a thousand words.

So for the kinds of subjects you should try and capture I will suggest a few different ways to show them at their best. Again, no special equipment is required, only a good eye! First, for all those incredible shots of people on motorcycles, complete with the family and the family pooch, try getting someone to drive, while you photograph from the passenger seat. You will get all the action, hair flying, dogs with their ears laid back and the like, and you do not have to worry about fast shutter speeds or anything even vaguely technical. Since you are travelling at the same speed as the motorcycle, from the camera’s point of view the subject is still. Simple! And you will get great shots that you cannot get anywhere in the western world. Only trick is to wind the window down first (or the autofocus won’t work) and don’t drop the camera. Always have the camera strap around your neck!

If that all sounds too difficult, then don’t worry, there’s still plenty of subjects to place in front of your lens. The local Wat is one of them. Quite frankly, I could spend a day in some of the temples and still not cover it all. However, here are some ideas. Some close ups of the ornately painted pillars. The boat shaped containers with the lit candles. A follower shaking the fortune telling sticks. Buddha images themselves - the shot with this article was taken with available light at 1/30th of a second, so easily hand-held. There is also the advantage that you are not disturbing worshippers with bright flash bursts. (By the way, I deliberately left the figure in the shot, to show some idea of the scale.) The orange robed monks walking through the area - there is just so much.

Now you have a photography project for the weekend. Go and photograph all the things that have become common-place, and amaze your friends!

Recipes from Rattana: Snowfish with Mushroom and White Wine Sauce

This is a European recipe, and a popular dish in the south of France and Monaco, often served with a Mornay sauce. It is presented here substituting a very easy mushroom and white wine sauce.

Ingredients serves 4

Snowfish Fillets 4

Shallots 3

Dry white wine 300ml

Mushrooms 60gm

Butter 30gm

Salt and pepper to taste

Cooking Method

Finely chop the shallots and lay them on the bottom of a buttered ovenproof dish. Lay the fish onto the shallots and season with salt and ground black pepper. Pour the wine over the fish.

Cut the mushrooms into strips and gently cook for 3 minutes in butter, then place over the fish, but keep the butter they were cooked in. Cover the dish and cook in the oven at 180C/350F for 15-20 minutes. Now remove from the oven and place fish in an ovenproof serving dish.

Heat the liquid left in the oven-proof dish until there is half the amount then stir in a mix of two teaspoons plain flour and one teaspoon of butter. Pour over the fish then drizzle the butter that the mushrooms were cooked in earlier and place under the grill to brown. Serve with rice.

Ask your local US Consul

Dear Consul,

I’ve been following the different accusations about “racism” in getting U.S. visas that have come up in some of the magazines and newspapers around here. I don’t know if that’s what I’d call it. But there’s another part of it, too. My wife and I recently applied for visas. She got one, which we were happy about. But I was told I didn’t even need a visa (I’m Italian). These things cost so much, isn’t it discrimination to make some people pay just because they’re darker?

- Mai Fair

Dear Mr. Fair:

Of all the factors that enter into the visa decision (or, more broadly, visa policy), I’m happy to say that skin color does not appear on the list. The same is not true of your passport’s color, however.

Citizens - of all hues - who hold passports from certain countries and are coming to the U.S. for tourism only (not study or work) for 90 days or less, do not need visas. You’re eligible to participate in this visa waiver program (VWP) if you hold a passport from: Andorra (which is allegedly between France and Spain, and is not a country we’re just making up to boost our stats), Australia, Austria, Belgium, Brunei, Denmark, Finland, France (or “Freedomland,” as pending U.S. legislation will rename it), Germany, Iceland, Ireland, Italy, Japan, Liechtenstein, Luxembourg, Monaco, Netherlands, New Zealand, Norway, Portugal, San Marino, Singapore, Slovenia, Spain, Sweden, Switzerland, and the United Kingdom.

I can hear the immediate question from here: “What about Canada?” No? Wasn’t your question? Well, since you’ve brought it up, let me answer it anyway: Canadians, even freedom-Canadians, have a special status that’s even better than the VWP. Our friends from the frozen north don’t even need a passport to enter the U.S., as long as they’re entering from the Western Hemisphere and can prove their citizenship. How do you show that? Well, erm, a passport is usually a good way. But in theory, all you need is a convincing “eh?” (and a birth certificate, or something).

Ok. The question you’re probably really concerned with is “why isn’t Thailand on the list, and what sort of [insert racist theory here that would apply to Thais but not Singaporeans] is responsible for that?”

In principle, Thailand could be. The VWP list isn’t static; it DOES change. It wasn’t long ago that Uruguayans could travel on the VWP; the country became ineligible only this past year, when economic problems drove up the fraud rate. And other countries are reviewed for suitability all the time. Before you start the petition drive, please know that the State Department uses strict criteria to evaluate potential membership in the VWP, including a low fraud rate and a refusal rate of less than 2 percent. Yes, I know WE generate the refusals. Those are based in part, however, on empirical studies of the overstay rates for different countries. Direct that petition energy to stamping out fraud in Thailand, and then we’ll talk (you can supply your own punchline as to the date you’d be coming in for that; I’m not allowed to).

Mr. Fair, you’ll be pleased to know that we at the State Department are keenly concerned about parity in the ease of travel of citizens from VWP and non-VWP countries ... so we’re about to make life a little harder for VWP folks.

Beginning October 1, 2003, all VWP travelers (those who are entering the country, and not simply seeking transit without visa) must have a machine-readable passport (MRP). Didn’t know machines could read? They can if your passport has a two-line strip of digits along the bottom of the page that has your biographical information. If your passport was issued by your country’s embassy in a foreign land, however, it’s not likely to be machine-readable. In your particular case, Mr. Fair, Italy’s domestic passport agency only started issuing MRPs recently, so chances are you don’t have one. In that case, you have the choice between applying for a visa for your current passport, or getting a new MRP.

See you in 2053,

The Consul

Have a question about visas, passports, travel to the United States, services for American citizens, or related issues? Ask the Consul. Send your e-mail to acschn@state.gov with “ask the consul” in the subject line. If your question isn’t selected, you can get an answer by calling the Consulate at 053-252-629, from 8 to 4.

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