Offshore Accounts

What is an Offshore Account?

• Definition: a bank account held in a country outside your country of residence
• Not inherently illegal (common misconception)
• Used by individuals and businesses for various purposes

Common Jurisdictions for Offshore Banking

• Switzerland:

  • TODO: banking secrecy laws (and changes post-2018)
  • TODO: account minimums and requirements

• Cayman Islands:

  • TODO: no direct taxation
  • TODO: types of accounts available

• Singapore:

  • TODO: strong banking sector
  • TODO: political stability

• Luxembourg:

  • TODO: EU member with banking privacy
  • TODO: wealth management focus

• Other jurisdictions:

  • TODO: Channel Islands (Jersey, Guernsey)
  • TODO: Hong Kong
  • TODO: UAE (Dubai)

How to Open an Offshore Account

• Documentation typically required:

  • TODO: passport/identity verification
  • TODO: proof of address
  • TODO: source of funds documentation
  • TODO: reference letters

• Minimum deposits:

  • TODO: varies widely by jurisdiction and bank

• Remote vs in-person opening:

  • TODO: which jurisdictions require physical presence

How to Withdraw Funds

• Wire transfers:

  • TODO: SWIFT transfers to domestic accounts
  • TODO: fees and processing times
  • TODO: reporting thresholds

• Debit cards:

  • TODO: offshore debit/credit cards
  • TODO: ATM withdrawal limits

• Checks:

  • TODO: drafting checks from offshore accounts

• In-person withdrawal:

  • TODO: visiting the jurisdiction

Tax Implications

• U.S. citizens and residents:

  • TODO: FBAR reporting (FinCEN Form 114)
  • TODO: FATCA (Form 8938)
  • TODO: taxable interest must be reported

• FATCA and automatic information exchange:

  • TODO: how countries share banking info
  • TODO: CRS (Common Reporting Standard)

Legitimate Uses

• Expatriates working abroad
• International business operations
• Diversification across banking systems
• Access to foreign currency

Risks and Considerations

• TODO: currency risk
• TODO: political risk
• TODO: limited deposit insurance
• TODO: difficulty resolving disputes remotely

References

• TODO: Add references