The historical HSBC Swiss leaks are still the subjects of the talks in media, both online and offline. Not only due to the scale of the leaks, but also due to the confirming fact of the offshore banks' negative reputation as the main destinations for money laundering and tax cheats.
But we have stumbled on this interesting article that very much confirming the status of offshore banking, as well as debunking the myths that have given offshore banking a bad name.
This article, written by the mysterious “Banker's Umbrella”, features one of his defences on behalf of offshore banking.
He stated what we also believe to be unjust: The assumptions that offshore banking is for illegal activities, such as money laundering and tax cheats.
This is his statement that is pretty much describing what offshore banking is all about: Offshore private banking was not an has never been just tax related.
And yes, even if it's tax related, not all related to cheating and other whatnot. Offshore banking can be as legal as it can be – it's your call; not the bank.
To dispell some myths, as well as to present little-known facts about offshore banking, we feel the need to set the record straight.
Offshore banking upsides
Inspired by the article, as well as from what we have learned so far in the offshore banking arena, here are 5 upsides you don't know about offshore banking:
1. Tax planning
Okay, here we go again with the top issue when it comes to offshore banking: It can be as legal or illegal as it can be. Perhaps this is why the negativities surrounding it is overshadowing the upsides.
What you might not know is that offshore bankers can help you with recommendations on tax planning. Regardless of your intention, offshore banks – and their bankers – offer tax planning services which allow clients to reduce taxes, which mean that they see more business profits or personal income using legitimate tax laws and regulations.
2. A stable jurisdiction for your wealth protection
While some use offshore banking services to keep their assets away from the local tax regulations, what an offshore bank can offer you is more significant than just that: Stable jurisdiction that will keep your assets safe and sound.
You can't deny the impact of jurisdiction on your wealth protection: Just ask the people in Ukraine. When things go wrong locally or nationally, chances are, your assets are 'locked' by the Government until further notice. Moreover, having your assets in an unstable jurisdiction can also compromise their safety and/or damage their overall value.
By moving your assets to a stable jurisdiction offshore, you can have the peace of mind living or doing business in your current's jurisdiction.
3. Investing possibilities – any kinds of it
Unknown to many, offshore banks offer wealth of investing vehicles to cater any level of investors. If you think your local banks' service is pretty diverse, you should learn more on what offshore banks can offer their clients.
Offshore bankers recommend and practically custom-tailor investing plan for their clients. If their clients want to invest in gold, the response given by an offshore banker is not “yes, you can – here's our products” or “no, you can't – we don't accommodate such products” - the response would be “yes, how do you wish for us to help making that happen?”
In other words, offshore banks offer direct investments into various vehicles – bonds, currencies, commodities, and so on; something that are not typically offered by 'traditional' banks.
4. Intellectual property secrets
Let's assume that you are an avid investor who don't want anyone else copy your investing methods – i.e. Which stocks you pick, which assets you own, etc. In order to protect your intellectual property, there's no way to do so if people can find you and what you are doing in public records.
Offshore banks' confidentiality feature lets you 'mask' your stock picks and so on, protecting your years of research from preying eyes who want to get rich quick stealing your investing 'formula.'
5. Flexibility that is unheard of
Offshore banking is almost always synonymous with private banking: Access to 'private' investment, as well as other banking products. According to the article we mentioned above, offshore banks' offering was impressive – and it had nothing to do with taxes.
The services include, but not limited to: Bank account, gold/silver-backed account, brokerage account, mutual funds, managed accounts, tax reclamation services, and so on. Please note that not all offshore banks offer the mentioned services.
Indeed, there are many ways for you to allocate your assets, and while those ways are available independently via various services, an offshore bank makes those services accessible from a single account.
As you can see, offshore banking is beyond what the general public perceived it to be; there are more good offshore banking can offer than the bad. The lawsuits, leaks and bad publications have overshadowed the benefits of offshore banking and misled the general public.
You have every right to find the right information. Hopefully, this article can shed some light for you.
If you want to learn more about offshore banking, you can consult with us.