Offshore Accounts: Safeguard Your Money

Many people around the world make the decision toreasons why illegal activities are generally associated
do their banking offshore. For most of us though thewith offshore banking. You can still be charged with
only time we hear the words 'offshore account' isand jailed for tax evasion in the US but the
when we're watching a movie involving gangsters andgovernment cannot touch your money.)
conmen. So what exactly is an offshore account andAsset protection is a major reason for offshore
why do people choose them over a regular bank?banking.
The Definition• Extremely high levels of confidentiality and security
An offshore account is simply a bank account you setexist with offshore accounts. This guarantees privacy
up in a country outside of where you live. This meansin all your financial dealings.
the government of the country in which you live hasDisadvantages
no jurisdiction over your financial transactions. There• US banking insurance policies do not cover
are advantages to this and disadvantages, dependingoffshore accounts and few offshore accounts offer
on which country you choose for your internationalcompensation schemes. This means if the country or
account.bank you have invested your money in collapses
Advantagesbecause of a political or economic crisis your money
• There can be substantial tax breaks and highermay disappear with it.
investment opportunities for offshore accounts. Many• It is more complicated to set up your offshore
offshore accounts are tax havens, which translatesbank account as there are many variables depending
into savings for the depositor. While you still have toon the country you choose. The minimum fees and
declare all income from worldwide investments in thedeposits required in some countries for offshore
US, you may gain from gross income interestaccounts make them financially out of reach for the
payments and other tax liability perks. A lot of offshoreaverage citizen.
accounts can also provide higher interest rates than• Offshore accounts have been tied to money
your home country resulting in greater growth of yourlaundering and all types of criminal activities. This can
current portfolio.affect your business reputation.
• Unknown to many US citizens is the fact thatAs with all financial dealings there are advantages and
there are high performing funds around the world thatdisadvantages to moving your money offshore. The
residents of the US cannot legally profit from. If youmost important thing when it comes to offshore
have an offshore account, however, you can gainbanking is to ensure you use a reputable company
access legally to these 'hidden' investments.that has expertise in international banking and tax laws
• For many offshore accounts you can dowhen you first set up your account. These trusted
multi-currency transactions without paying the higherfinancial companies will look at your portfolio and
fees of domestic accounts and can write cheques orassess the risk versus profit margin of the varying
complete transactions in any country in the world.countries offering you offshore accounts.
• Some offshore banks allow anonymous bankEach country comes with its own set of tax laws and
accounts and lower or higher rate loans.levels of security. There are also a myriad of different
• The government of your home country does notaccount types and investments depending on what
have jurisdiction over your offshore account. Thisyour financial goals are.
means they cannot freeze your assets or seize theOffshore banking is definitely an area to entrust to the
money for any reason. (This is one of the mainexperts.