It was widely believed that an offshore bank account's primary purpose was to store stolen cash and other forms of black money from illegal gambling, terrorism, corruption, and theft! Unfortunately, this corrupted view of offshore or foreign banking has shunned the concept of opening an offshore bank account for many business people and investors. These enterprising individuals have forgotten the opportunity to protect offshore assets in fear of being associated with such illicit activities and have not been able to make use of some of the world's largest banking jurisdictions.
There are a variety of myths regarding offshore banking that prevent people from taking advantage of the advantages an offshore account can offer. Nonetheless, once you know the truth about using offshore banks, you will make smart decisions to protect your assets from litigation and privacy violations.
Common Myths about Offshore Banking
Sadly, the standard image of offshore bank accounts is placed to store drug income, illegal criminal earnings, white linen covers, action-packed movies, and misleading news stories.
Unfortunately for many, this distorted image of offshore and anonymous banking caused many business people and business professionals to fail when the idea of offshore banking was discussed.,
Instead of fully recognizing the benefits of securing offshore assets and banking tax shelters, they have avoided investing offshore because they are not linked with this. Fortunately, the offshore bank's negative image is becoming quite dated and outdated in today's markets and contemporary thought.
It is Illegal
One of the common myths surrounding offshore banking accounts, many people assume that offshore banking is either illegal or illegal. However, the truth is that setting up an offshore bank account is 100 % legal, given that the appropriate guidelines are followed for each jurisdiction.
Today with more Mutual Legal Assistance Treaties (MLAT) in effect, criminals have less chance of using offshore bank accounts illegally. Currently, 500 fortune corporations and high net worth individuals make a significant share of offshore deposits trying to secure their assets with legal strategies for tax minimization.
It is Solely for Tax Evasion
Offshore banks do not help or promote tax haven but rather provide a legal tax planning alternative. These bank accounts function as an alternative financial instrument for investors who want their investments covered and diversified. Some of the advantages of offshore bank accounts offer are:
- Protection from political or economic instability in the home country
- Reduced tax burden associated with the country of residence
- Protection of the assets from future legal proceedings, including civil disputes.
- Diversified currencies
You Need to Visit the Bank to Open an Account
The customer does not need to travel to the offshore jurisdiction to open the Account. The bigger banks have put in place due to diligence procedures to allow bank accounts to be fully opened by phone, fax, email, and courier.
Since some banks need a presence at their place, using an experienced corporate services firm's services may make this process more efficient, as the corporate services agent already has an existing relationship with the bank.
Confidentiality is the Only Reason for Offshore Banking
Most of the benefits of offshore banking come from anonymity. Yet there are a lot of reasons to think -
- A vast range of investment returns
- Currencies diversified
- Enable your cash while on a trip abroad
- Better functionality and advantages of banking
Offshore Banking Can be Undertaken in Thriving Developed Countries
The concept of setting up a bank account on a small tropical island is widespread, and many small jurisdictions attract foreign investors. There are also several choices for some of the world's technologically advanced jurisdictions. An offshore bank account also enjoys all the advantages of a local bank account, including multi-currency accounts, electronic transfer, payments.
Offshore Account Are only for Wealthy Individual
Offshore accounts are valuable to many, not just the wealthy. You wouldn't want to spend the time and resources just a few thousand dollars setting up an offshore account. Still, many people feel that they can benefit from having an offshore account that protects their assets from litigation and privacy invasions.
Offshore Account Aren't safe
There are some misleading tales of people losing all their money when they unexpectedly vanished from their offshore accounts.
However, this only happens in countries with weak legal structures. While choosing offshore accounts in stable countries, you don't have to worry about your asset security.
Final Insights
As we can see, the misconceptions surrounding offshore banking are numerous. However, as we dive in, we see that offshore banking is tightly regulated. Banks may lose their rights or be liable to harsh punishments to take on unpleasant customers.
Regulators regularly audit banks for their record of their insight of their clients. When a bank investigator believes that anyone is using their overseas Account for unsavory reasons, they won't get an open account.
They will soon be thrown out of the bank if used in this way after the account opening. A bank that keeps its license relies on them as per local and foreign regulations.
Additionally, they must adhere to strict levels of financial power. Banks around the world are now working very hard to implement the regulation. Here at Business Setup Worldwide, we are assisting our company with banking facilities in multiple jurisdictions. Contact us today and know more about our services!
