The benefits behind an offshore bank account and how it reduces sovereign risk
Offshore bank account
An offshore bank account can be a crucial part when trying to move your business forward. It can be very beneficial when it comes to currency control especially with government regulations forever becoming stricter. Offshore banking enables you to store your assets and wealth in another country, not making you subject to the UK tax laws.
It has been known for governments to freeze assets without permission or having proof. Therefore, having an offshore account can be very beneficial for security reasons. A process such as this can be very lengthy and create a situation where you are no longer generating profits.
A bank account in a foreign country can be very beneficial for your business. A foreign bank account should be settled in a low tax jurisdiction as this means you will be able to recoup more profits and spend it elsewhere. Also ensure that the country is financially stable and does not have a history of economic turmoil.
Having a foreign bank account is not purely about benefiting from tax cuts it is about sovereign risk. This spreads out the risk if something happens to the country that is holding your money and assets. By having a few different offshore accounts, if something does go wrong you will not be as affected.
Benefits of an offshore account
As mentioned an offshore bank account can bring numerous benefits to your business. Having offshore banking enables you to be able to benefit from lower tax jurisdictions. A few examples of countries that encourage lower tax jurisdictions are: Seychelles, BVI and Cyprus.
These countries do not just have low tax rates but also encourage you to enter the country by having easy set up procedures and sometimes double tax treaties. However some of these benefits are only made available when you set up an offshore company.
Having an offshore bank account can often mean benefitting from better interest rates than those in your home country. The truth is often unrealized by consumers and businesses that other countries offer better rates, this is because the domestic banks want to keep your business.
How to set up offshore banking via the internet
It is often the case that banks will make you come in person to set up an account. As well as providing an endless array of documentation to the bank. However, it is very simply to set up an offshore bank account from the comfort of your own home. With offshore banking online, you can access all your accounts from your desktop. If you do not have internet you can simply enter a branch in the UK and they will set you one up abroad.
Summary
The benefits of an offshore account are clear. It can give your business freedom and mean it diversifies its sovereign risk. Through having numerous accounts in various jurisdictions both low tax and financially secure, it can enable your business to thrive.
Author Bio:
This post was provided by offshore formations 247. They are a company formation agent who specialize in creating offshore incorporations and help with their offshore company setup.
Category: Finances
