The market in both offshore and onshore bonds from UK investors will continue in the foreseeable future as rising house prices, the European...

The market in both offshore and onshore bonds from UK investors will continue in the foreseeable future as rising house prices, the European Union'sSavings Tax Directive and emigration fuel a greater need for tax planning, according to financial research company Defaqto. The bond industry has become important in providing trust solutions for estate planning and in 2005 alone there was an 18.5 per cent year-on-year increase in sales of onshore bonds, research from Defaqto reveals. Estate planning has now become more important following the UK Treasury’s potentially retrospective proposal to extend inheritance tax to cover some trusts, according to the research. And more people in the UK are now caught by this with the rapid acceleration of house prices. Estate planning is no longer a problem just for the very wealthy, said Defaqto. The main driver of the offshore bond market is the increase in overseas migration of UK citizens over the past ten years and the expectation of continued growth in the future.