However, for people of relatively modest means there is likely to be at most only a marginal benefit in doing so. "Any offshore investment will have to justify itself on investment criteria alone," says Jane Seymour of accountants Clark Whitehill.
Many funds are legally based offshore. But they are often run from the City of London by well-known firms that also sell unit trusts and investment trusts based in the UK.
One reason for UK residents to go offshore is for greater investment flexibility than that which the regulatory authorities give to unit trusts.
For example, you may want to invest in something with a higher-than-average risk for greater returns, such as a hedge fund run by the likes of George Soros. But if you count as a UK resident for tax purposes and you are "domiciled" in the UK, you have to pay UK tax on your income and gains wherever in the world they arise.
However, that is not to say there are no tax advantages in going offshore.
Offshore roll-up funds do not pay out a dividend but reinvest interest and other income in the fund. These funds can provide compound growth tax-free until you cash them in. But any return from the investment would then be liable to UK income tax. If you are currently a higher-rate taxpayer but expect to become a basic-rate taxpayer on retirement, the eventual tax bill will be lower.
If you are planning to move abroad and will become non-resident, postponing cashing in the investment until you have left the UK will mean you escape UK tax. However, there may well be tax due in the country in which you end up living.
Anyone tempted by offshore investments needs to consider that there may be an extra risk from slacker regulation. Investor compensation schemes may be less generous than in the UK.
There are two categories of people who might get significant tax advantages from offshore investing, Ms Seymour says. "First, someone who is resident in the UK but domiciled abroad. This person is only liable to pay tax on income and gains arising abroad when they are brought into the UK." An example here would be foreign nationals working in the UK. If they invest offshore and do not bring the money into the UK they will not be taxed.
The second category is UK expatriates. If expatriates become non-resident, investment income and gains arising outside the UK will not be taxed in the UK. But there are strict rules on what counts as non-residency and how it is achieved. You have to be outside the country for a full tax year if you are working abroad. If you are not working, non-residency may be only provisionally granted. There are also strict rules on the length of visits back to the UK if non-resident status is to be maintained. Advice is crucial, as it is for anyone about to return to the UK.
"Some people can benefit from investing outside the UK. But tax should be only part of the consideration. You should not make any decisions until you have consulted a professional adviser and your domicile and residence status have been checked to ensure you avoid unexpected tax charges," Ms Seymour says.