The international bank account is suitable for a variety of different business and personal situations. In the past these accounts were associated with patrons who had “something to hide”. However, today this is far from the case.
International, or offshore bank accounts, are an excellent tool in today’s changing business and economic conditions. There are certain situations when the offshore bank account can be an invaluable tool. The largest group of people who by far utilize the offshore account are expatriates. Those residing in foreign countries for long periods of time use international bank accounts to have funds readily available in the currency of their new home. Opening a foreign bank account for these expatriates can often be as simple as going to the large branch of a bank in their home bank that has branches in the country to which they are moving. Also, in some big cities, a large bank from their new home country will have branches there to assist in the opening of the account.
Another person who might find it helpful to open an international account is the frequent traveler. Do you find yourself stationed at another location outside of your home country for work reasons much of the year? Constantly wiring and transferring funds from place to place or currency to currency can be a real headache. It is helpful for these people to have funds readily available in the correct currency.
While Western patrons think of their money as ‘safe’ in their local banks, this is not the case for all global citizens. In some countries, the tumultuous political climate is such that citizens fear for the safety of their funds. For these people the foreign bank account provides an extra layer of security for their hard earned capital.
Private citizens as well as corporations enjoy greater privacy when banking offshore. Some of the 70+ offshore centers pride themselves on the discretion afforded to those who bank with them. This has long been the case with Switzerland, but other countries soon followed and it is standard in many offshore financial centers. It is important to note though that while there is some privacy, if the correct official law enforcement groups subpoena information there will be full cooperation on the part of the banking institution as required by law.
Offshore banking institutions are well known for paying out better dividends and interest than their onshore brethren. This varies greatly from bank to bank, so it is highly recommended that people interested in receiving these improved payouts check thoroughly and compare. It is also interesting to note that offshore financial institutions are not as thoroughly scrutinized as onshore banks. This means that they may have more creative funds and are able to offer certain investments that other banks do not.
Lastly and most importantly, the income derived from offshore bank accounts is often not taxed. This varies as well and depends on the tax laws in the home country as well as the offshore center.
It is often thought that just the super wealthy benefit from the offshore bank account but this is no longer the case. The banking fees associated with these accounts, while not nominal, is often affordable. It pays to investigate this option thoroughly. However, to those who use it wisely, the benefits of the offshore bank account can be tremendous.