Which Offshore Bank Account is Right For You?

Setting up a bank account offshore can provide investors with a number of advantages, privacy and flexibility if the banking destination is selected with care. Offshore bank account holders can receive large reductions in taxes as well as earn interest on their money tax free in most offshore banking jurisdictions.

An offshore bank account can help investors to protect their liquid assets and real estate in a tax free zone.

Setting up an offshore bank account in a country like Panama can cost up to $1400 depending on who you work with but this is a small price to pay which is easily recovered through the advantages of using the bank account itself.

An additional optional cost to consider is consulting fees with an offshore banking expert or asset protection lawyer. Paying a little extra money before making an offshore banking commitment can actually be a way to save money in the long run.

Types of Offshore Banking Accounts

There are three main types of offshore bank account available typically and those are; personal bank accounts, corporate bank accounts and merchant accounts.

Personal Accounts

A personal bank account is only available to an individual person. A personal bank account is the least protected asset protection vehicle but in general are governed by the same banking secrecy laws as other types of offshore bank accounts. A personal bank account has the caveat that your own name is attached to the account. There is no layered protection with a personal account.

The costs associated with maintaining a personal offshore bank account are much less than for a corporate. Getting a personal bank account is also the easiest since it requires that you provide a host of personal information to be set up such as proof of identity, notarized photocopies of your passport and full address information.

Corporate Bank Accounts

To hold a corporate account offshore an applicant must first register a corporation in that jurisdiction which comes at an additional cost over and above the cost of setting up the bank account itself. Depending on the asset protection structure being used it is possible to set up both the corporation and bank account itself without a person's name appearing on the the corporate or bank account documents.

If an asset protection structure, such as a non profit foundation owning the corporation which owns the corporate bank account is used (which is available in Panama) greater secrecy and privacy can be achieved.

Merchant Bank Accounts

A merchant account is typically utilized by businesses or websites that need to do credit card processing. While it is fairly easy to set up a merchant account with a local bank in your country moving your processing offshore can actually make your transaction processing less expensive; a savings you can pass on to your customer.

See Also

Investing - Offshore Bank Profits

Three Steps to Opening a Bank Account Offshore

Which Offshore Bank Account is Right For You?

External Links

Wisegeek.com

Offshoresimple.com

Askmen.com