Don’t wait for another punchline, it’s not a joke. Although the world’s great and not-so-good have been caught up in the sensational "Panama Papers" revelations, the latest twists and turns have revealed an even more intriguing side to the life of offshore finance - it might not be that murky, and anybody and everybody could have been involved.
We could all be exposed to Panama
Tax specialists have said today that "millions" of British citizens could be invested in similar schemes, either directly or through their pensions.
"It is very possible these sorts of products are in use in the pensions industry. Big insurance companies, for instance, have long used more exotic vehicles and investments within everyday plans," Adam Laird, investment manager at Hargreaves Lansdown told City A.M.
"It is mostly hedge funds that invest in, say, the Cayman Islands or the British Virgin Islands, but many pensions funds would invest in Luxembourg or Ireland, or less exotic overseas [jurisdictions as well]."
"There are many legitimate reasons for investing in offshore funds," he concluded.
|Panama papers: What you need to know|
Offshore funds are a lot more prevalent than their exotic title suggests. HM Revenue and Customs (HMRC) publishes a list every month of “funds that come within the definition of an offshore fund”.
The Investment Association estimates that £895bn of the industry's £5.5 trillion of assets are held in funds domiciled overseas.
Is it tax avoidance?
The prime minister was yesterday forced to admit that, after some hazy press statements suggesting otherwise, he had benefitted - to the tune of around £30,000 - from an offshore investment fund, Blairmore Holdings, set up by his father.
There was uproar. Labour accused him of outright hypocrisy and said he had to come clean about his tax affairs.
The prime minister will not be best pleased that his own - and his late father’s - name are being used in such close proximity to words like “offshore”, “tax haven”, “tax avoidance” and “hypocrisy”.
But critics - and newspapers - have been choosing their words carefully. For most, the only links they feel comfortably making are that Cameron had money in a firm which was based offshore.
The Guardian arguably goes the furthest, with its headline: “Cameron finally admits: yes, I benefited from tax-avoiding offshore fund”.
That’s because there is nothing to suggest the prime minister has personally avoided tax. "There are millions of people in the UK who have invested in similar funds. If he [Cameron] has done something wrong, then so have millions of people," James Quarmby, a partner at law firm Stephenson Harwood said.
Read more: In defence of tax havens
“There is little or no tax benefit from choosing to invest in an offshore fund compared to investing in a UK-based fund,” according to the Investment Association. “You are required to pay tax on the money earned from the investment, just as you would if you were investing in a UK-based fund.”
Why go overseas?
There has been a “massive misunderstanding” about the fund David Cameron invested in, according to Quarmby. “It’s no different from Mr Cameron investing in a UK stock,” he told BBC Radio 4’s Today programme this morning.
“Collective investment funds, whether technically called unit trusts or investment trusts, were very commonly administered from financial centres in the dollar area, such as the Bahamas or Bermuda, if their purpose was to invest in a portfolio of investments which were primary in the dollar area,” Graham Aaronson QC told Politics Home.
“It would … be quite wrong to describe UK residents who invested in such funds as indulging in ‘tax avoidance,’” Aaronson added.
With 11.5 million documents from Panama law firm Mossack Fonseca still being sifted through, the revelations appear far from over. Investors and pensions holders can probably rest easy - unless you have an armed forces at your disposal or have taken to moral crusading about tax avoidance, you're unlikely to hit the headlines in quite the same way.