IFSC vs UCITS vs direct: a situs comparison

5 min · For educational purposes only

The same S&P 500 exposure can be held three different ways with three different estate-tax outcomes. The choice is a 30-year decision dressed up as a product decision.

Direct US ETF (e.g., VOO)

Lowest cost, tightest tracking, deepest liquidity. US-situs — your estate is exposed to US estate tax above USD 60k.

Irish UCITS ETF (e.g., CSPX)

Slightly higher expense ratio. Irish situs eliminates US estate exposure. Dividends are accumulated inside the fund, deferring dividend tax events. The standard global default for non-US investors.

IFSC AIF Cat-III feeder

Indian situs — fully passes to Indian heirs under Indian succession law. Higher operating cost than UCITS, but cleaner inheritance and simpler tax reporting for the Indian resident.

Key takeaways

Same exposure, three situs outcomes — pick deliberately.
UCITS is the global default for non-US investors; IFSC is gaining share for Indian-resident estates.
Cost difference is small; estate exposure difference is enormous.