An account has long since been a subject of great curiosity and debate. Here we discuss what you gain when you open an account - protection from high taxes and creditors, stability and freedom to make your wealth grow. You can open a bank account by first having an offshore structure and then opening an account in its name.
The 5 Advantages of Offshore Account
Advantage 1 - Less Tax And More Control
An offshore account offers a tax advantage when it belongs to an offshore structure/offshore entity. The offshore entity you may form can be an offshore company such as an International Business Corporation, a limited liability company or partnership, a Trust or a Foundation.
Depending on what tax laws apply to you these forms of companies or entities offer significant advantages in income and wealth tax as compared to an individual personal tax rate. They also offer advantage in terms of other government duties/levies when transactions such as sale, purchase or transfer of assets happen.
An account can hold the proceeds from these transactions. Another advantage is that since the account is offshore there is no deduction of tax at source. Tax if applied can be paid when settled as payable. An account thus offers a comforting sense of control over your money.
Advantage 2 - Protection from Creditors
In many legal disputes the creditors can get a court order from the first court to appropriate the liquid assets of a debtor even if the case goes to appeal in the next court. This order is difficult or nearly impossible to execute when the debtor has an account in which he holds liquid assets.
This gives you respite from your creditors until the dispute is settled and also provides you a bargaining edge. Thus your assets are protected from your creditors if you hold them in an offshore account.
Advantage 3 - Protection From Unstable Regimes
Most of the offshore accounts are located in small but stable countries whose national income is derived from providing dependable business and banking environment. Political instability in your home country can be risky to your assets.
There is a fear of account being frozen, your money being appropriated, or your money not going to your descendents smoothly. An offshore account is a great respite from these fears.
Your assets, your wealth remains safe in a stable jurisdiction unless you are implicated in a serious criminal offense. Stability is one of the most common causes why people want an offshore account.
Advantage 4 - Higher Returns
Your offshore account is capable of giving you a higher return on two counts. You may be offered a higher interest rate when compared to your home country. And you may be able to open an account that holds several currencies.
This multiple currency facility may afford you freedom to transfer money from one currency to another and maximize your gains. Many jurisdictions offering offshore account have banks which attempt to attract clientele by offering higher interest because of their lower costs and higher competition.
Advantage 5 - Freedom And Confidentiality
Bank accounts offshore are chosen by most because they are confidential. In your home country you may not be able to keep your wealth away from prying eyes. To keep your money securely locked in a confidential location you will need to choose an offshore jurisdiction.
Most offshore accounts are owned through confidential entities. Hence they offer you another collateral advantage. You can transfer the money to other locations in the world without the hassle of paperwork of exchange regulations and costs that this may entail in your home country.
This freedom of transfer is a great advantage in fund management and investment planning. Thus apart from confidentiality you also have access to many more investment options if you have an offshore account.
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