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 Business News | January 2005 
Offshore Banking FAQs
 OffshoreBiz.com
Belize is a leading Caribbean offshore jurisdiction, and many visitors are intrigued about offshore banking. The growth in international travel, coupled with the increasing use of the Internet to make a living or help manage businesses from afar, have led to growing use of offshore banking and offshore trusts. Others have made the same decisions to relocate or diversify their financial affairs and open offshore accounts. These are some of the questions we answered for them.
 What is offshore banking?
It is simply banking in a jurisdiction other than the one in which you live.
What are the benefits?
Offshore banking could have tax benefits, i.e. interest on offshore accounts and investments is paid without the deduction of tax. You may also be able to reduce your tax liability in your home country by transferring savings and investments to an offshore bank account. Added benefits include high levels of confidentiality, security and convenience, as well as global access.
Do I have to travel overseas to bank offshore?
No. You never actually have to visit your offshore bank. You can simply bank from wherever in the world you live, via Internet, email, post or telephone (either through a touchtone phone or by contacting your banking representative or registered agent.
How do I get an offshore account?
There are several companies that specialize in setting up offshore bank accounts. We recommend Belize Offshore Consultants Inc. (Note: We do not derive any commission or referral fee from BOCI - we simply believe they provide an excellent and secure service and have been referring clients to them for many years.)
Is it legal for me to have an offshore bank account?
Yes, absolutely legal. Offshore banking has been routinely and legally used for many years by individuals and organisations worldwide. Because many countries encourage international trade and enterprise, there are usually only limited restrictions on residents doing business or having bank accounts in other countries. However, reporting requirements on these accounts differ from country to country.
Is it convenient to use offshore banks?
Yes. With the Internet, email, fax and telephone banking and the use of ATMs, your money is just as accessible as it is from your local bank account. You can easily and quickly transfer your money around the world by electronic transfer and can effectively bank wherever you are.
What about income tax on income I've earned offshore?
Some countries require residents to declare their income on a worldwide basis and tax is payable on all your income. In certain circumstances the income of an entity which you control may also be taxable. For this reason, most countries have no restrictions on where your business interests, investments or bank accounts may be located. It is your responsibility to report income to your appropriate tax authority.
If I have to pay taxes, why should I bank offshore?
There are many other reasons to bank offshore apart from minimising your tax liability. Other reasons include asset protection, estate planning, confidentiality, better returns and the chance to exploit active business interests overseas from a zero tax jurisdiction with near hermetic confidentiality.
I would like to keep my personal affairs confidential for reasons other than tax minimisation. Are confidentiality and privacy guaranteed?
The offshore jurisdictions offer extraordinary levels of confidentiality but they cannot offer absolute secrecy. All financial institutions have a legal obligation to report suspicions of serious criminal conduct. Foreign authorities can seek information, through the legal system, where there are well-founded suspicions of serious crime. A serious crime is defined as anything which is a crime in the offshore jurisdictions and would warrant a prison sentence of at least twelve months. Near absolute anonymity and confidentiality are achievable via a combination of various offshore vehicles, including International Business Companies (IBCs) and Offshore Trusts. Otherwise, all personal data is subject to modern data protection legislation, and there are civil and criminal penalties for breach of confidentiality and unauthorized disclosure.
Can I get a debit or credit card with an offshore account?
Yes. You get an internationally accepted debit card.
What is the minimum deposit required to open an offshore account?
It all depends on which account you choose. But you can start off with a deposit of $1,000.
In which currencies can I open an offshore account?
Accounts are available in all major currencies, including US dollars and Euros. |
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