Offshore Bank Account

An Offshore bank account is a bank account that is opened in an offshore jurisdiction (tax haven). Offshore bank accounts can be opened by individuals or companies, or any legal entity such as an offshore foundation or a partnership. Offshore bank accounts work just like regular onshore bank accounts. However, some offshore banks offer only offshore corporate accounts, while some banks offer a wide range of accounts include personal and corporate checking, savings, CD and more recently offshore brokerage accounts (offshore trading accounts). Offshore brokerage accounts are specialized accounts from which trade activity is conducted and monitored.

The popular offshore bank territories are Panama, Dominica, Bermuda, Belize, British Virgin Islands, Nevis, Latvia, Liechtenstein, Seychelles and Guernsey among others. These are preferred offshore banks in that their requirements for opening offshore bank accounts are much more favorable; easy to open, no stringent conditions are attached (high initial deposits, minimum deposit amount), and attractive interest rates.

There are tax benefits to owning offshore bank accounts. Most offshore jurisdictions are tax havens this therefore means that the monies/capital or interest earned in an offshore bank account are not subjected to taxes in the country as long as it is generated outside of the country. Offshore bank accounts are an effective means of reducing tax liabilities. You can provide asset protection if you transfer assets in the form of capital/revenue into an offshore bank account, where such assets can be protected from divorce, civil litigations settlements.

Offshore bank accounts have access to the same basic onshore bank services such as money wire transfers (sending and receiving), letters of credit, bank drafts, debit and credit cards, plus include other nontraditional offshore bank account service such as multicurrency accounts, offshore brokerage accounts (offshore trading account), offshore brokerage or trading services, tax planning consultancy , asset and wealth managements services, opening of accounts by proxy (agent), opening of account remotely, offshore numbered accounts. Offshore numbered accounts are of great interest to investors, but are becoming rarer with the implementation and stricter regulations on international offshore banks to prevent money laundering etc, but are still available. These are offshore bank accounts are accessible by number and not a name, where the identity of the beneficial owners of the offshore bank account is known to just a few senior officials of the banks. This type account provides a high degree of privacy and security for investors but such accounts are more expensive to acquire than general offshore accounts.

When an offshore company or an offshore corporation establishes an offshore bank account such accounts are afforded the same confidentiality offered to numbered accounts the name of the account is that of a corporations, and the beneficial owners of eth corporation are confidential information and not available for the public to see in transactions or activities.

In order to open an individual offshore bank account the basic requirements are (though not exhaustive):

  • A letter of reference
  • A certified copy of passport pages (for identifications)
  • A bank statement
  • A completed application form
  • Proof of address (a utility bi, statements)
  • Signatory cards

The documents necessary for applying for an offshore bank account may vary from jurisdiction to jurisdiction and some banks do not open offshore individual accounts without a personal introduction or the use of intermediary services.

In order to open a corporate or company offshore bank account on behalf of a corporation/company the following documents are needed:

  • A complete application form
  • Certified copy of the company’s Certificate of Incorporation
  • Certified duplicate of passports or other forms of identification of the persons who have the rights to access the account,
  • Bank references/recommendations for the persons with account access
  • Address verification of signatories

As previously mentioned the documents may differ based on the jurisdiction of choice.

If opening an offshore bank account, choose a jurisdiction which is well respected and has a long established record. Do your research! Use the advice of offshore service agents who can provide the critical introduction services. Some banks will only entertain “referred” clients. Offshore banks are generally located in distant and remote locations, but with technology and communications there is absolutely no need to travel to the jurisdiction of choice to open offshore bank accounts or to do any type of banking activity. Most banks offer internet banking making it easy for clients to conduct business at home or on the move anywhere in the world.

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