Deciding on which country would be the most suitable for corporate bank account opening is imperative for your business. In this article, we discuss some key factors you need to take into consideration when deciding the best offshore bank account for your business.
How to choose the best jurisdiction with an offshore bank account?
To choose the best jurisdiction to set up an offshore business account, the following factors must be kept in mind:
#1 Privacy and Security:
- An offshore bank account is supposed to provide privacy and security for the business. This is guaranteed by the government regulations and the banking policies which guarantee greater confidentiality by not making information about the company public and also provides security for the assets held by the company in the offshore business account.
#2 Tax Benefits:
- With an offshore bank account, your business can face a lower tax burden, depending on the government policies of the country you wish to set up your account in, thus ensuring tax optimisation. This is different from tax evasion which negatively affects the public perception of the business.
#3 Higher interest rate:
- In different countries, the interest rates provided in bank accounts differ. Therefore, it would be more suitable for you to choose a bank account where you are offered a high interest rate on your savings.
#4 Lower risk:
- Offshore banks usually provide multi-currency facilities which allow businesses to diversify their currency portfolio, thus reducing the risk of currency fluctuation. Moreover, banks also provide access to the global markets, thus increasing the investment opportunities available. This further allows businesses to diversify the market risk as businesses are not investing in only one financial market but multiple markets.
What are the top 3 countries with the best offshore bank accounts?
Based on the previously mentioned factors, the top 3 countries for completing the offshore bank account opening are:
#1 Switzerland:
- Switzerland has one of the largest and well-respected financial centres in Europe with its high concentration of local and international banks and beneficial policies issued by the government and banking authorities.
- According to the Swiss Banking Law of 1934, there are strict privacy laws, guaranteeing complete confidentiality. This implies that any information about the account holder and their transactions is not disclosed to the public, without the permission of the clients. Moreover, if your business is looking for asset protection, Switzerland might be a good choice.
- Additionally, a low tax rate of 8.5% is levied by the government, which is comparatively lower than the Worldwide Average Statutory Corporate Income Tax Rate of 24%, measured across 176 jurisdictions. The banking authorities also provide account holders with multi-currency facilities and access to global markets for investment opportunities, allowing them to diversify any market risk.
- However, the interest rate provided by the banks on deposits is negative, which is a downside to setting up an offshore bank account here.
- Keeping all the factors in mind, Switzerland may be one of the most suited countries for business bank account opening.
#2 Singapore:
- Singapore has a strong and respected financial infrastructure owing to a stable political and economic environment along with strict but flexible regulations of the governing body. This well-established financial hub has led to greater efficiency and high-quality services.
- The strict government regulations guarantee the security and privacy of assets and investments of the account holder. This information is not shared with the public unless permitted by the client.
- The corporate tax levied by the government is 17%, which is relatively lower than the Worldwide average tax rate of 24%. Moreover, capital gains and profits are not taxed in Singapore. Besides this, Singapore has signed tax treaties with over 60 countries, preventing double taxation and thus, lowering the tax burden. The average interest rate on fixed deposits is approximately 1%, which is not very high but at least is not negative.
- The multi-currency banking facilities lead to lower currency risk and allows individuals to facilitate global trade more conveniently. The access to global markets has allowed Singapore to diversify its market risk as well.
#3 Belize:
- Under the Belize International Banking Act (previously known as Offshore banking Act 1996), Belize is one of the best countries to set up an offshore bank account. The financial sector accounts for a large portion of the country’s GDP and is, therefore, well managed.
- As per the banking regulations in the country, there is high regard given to the privacy and security of the business assets. Information about the account holders is not disclosed to the public. Moreover, assets are well protected such that they cannot be frozen in case of any issues faced by the business in the home country.
- Belize is considered to be a tax haven and would therefore be well suited for your business. However, depending on your home country’s policy, you may be required to pay tax on your income. For example: in the United States, you will be required to report your assets to the Internal Revenue Service (IRS) and pay the required tax. Moreover, the average bank interest rate on deposits is 2.5% per annum.
- The banking authorities in Belize allow for international banking facilities. It also provides its clients with diversification opportunities to lower their risk.
Need help selecting the best jurisdiction for your offshore bank account?
Now that we have identified the top countries with the best offshore business accounts for foreigners, the next step is to identify which offshore jurisdiction would be the most suitable one for your business and to proceed with the registration.
With Tetra Consultants, this process will be made easier. We will first understand your business needs and capital, and then recommend the most suitable offshore bank for you. Our team of experts will then proceed with the corporate bank account opening on your behalf by leveraging our extensive banking network.
Contact us for a free consultation if you wish to know more about which offshore bank account is best suited for your needs. Our team will revert to you within the next 24 hours.
