If you bank with a bank based outside your resident country then this is usually called offshore banking. Most of the time, offshore banking is used as a way to avoid paying taxes on savings and large sums of money – they can also be used illegally sometimes.
Offshore banking is completely legal and a lot of people use them to keep their money more secure and to get better rates and less restrictions on their banking activities. The phrase “offshore banking” was first used by the UK and the first banks to be used were in the Channel Islands.
Many major offshore banks are situated on islands around the world which brings true meaning to the phrase “offshore banking”. However, there are a few offshore banks which aren’t located on islands but they are still classed as offshore bank accounts.
It isn’t always the case that you won’t pay tax on your money if it’s in an offshore bank account – this is a common misconception. You can still be taxed on money you have in an offshore bank because a lot of country’s tax laws state that all assets are subject to taxation so make sure you stick to the law.
However, offshore banks are not legally required to report their income to any tax authority, nor are they required to even list who banks with them.There are some very valid reasons why you may want to use an offshore bank. They are often very economically, financially, and politically stable.
Many people decide to use an offshore bank if they feel that their area’s financial situation is going to change dramatically – now is a good time. Higher interest rates on savings accounts and fewer fees are probably the most popular reasons as to why people use offshore banking.
Offshore banking is cheaper because the companies don’t usually have large overheads like most local banks have. As interest in an offshore bank is classed as worldwide income this usually means that you will earn interest before it’s taxed.
Some offshore banks also offer services that aren’t available from local banks. For example, the cliched anonymous Swiss bank account that is often used in books or movies really does exist.
A lot of Swiss bank accounts are anonymous which means you don’t have your name attached to it – you can simply use the account number for all transactions. If you’re interested in an offshore bank then you will be pleased to hear that there are a number of options in and around the UK.
Bank of Scotland International is an offshore bank that may interest you – as is the Halifax International which is actually one of the oldest. If you want to start an offshore bank account you usually have to have at least 5000 GBP in order to open an account.
If you want a savings account that isn’t taxed then you should consider Skipton Guernsey Limited which has a variety of services available. You should be able to find some deals that suit you because offshore banks are usually very competitive.
All in all, if you want an offshore bank account then you’ll need to start saving and do some serious research in order to get the best deals. You shouldn’t have too much of a problem finding an offshore bank account that have the services you need and the options that you want.
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