If the notion of an offshore company is now quite rooted in everyday vocabulary, the same is not true of the offshore bank account. More confidential because less often put forward in financial scandals, it is often only a tool of the extraterritorial company, but it can also be used alone, so how to open an offshore bank account online?
What is an offshore bank account
An offshore bank account via Offshore citizens is a bank account opened abroad, most often in a tax haven. Offshore because precisely “off the coast”, originally, most tax havens were located overseas, in island countries such as the Bahamas, the British Virgin Islands, Seychelles …
Things have changed since then and there are tax havens all over the world, for example, the US state of Delaware, Cyprus, Luxembourg or Panama are tax havens particularly popular.
The first thing you might ask yourself is if these offshore bank accounts are legal. It depends, but if they meet the requirements of the tax administration, then yes, they are. Bercy, like other jurisdictions elsewhere, requires that if you own this type of account, you declare it.
In contrast, opening an offshore bank account, and not declaring it in the year is therefore illegal.
The offshore account can be of two types, it can indeed be an account of individual, opened in his name and used for various personal transactions, or it can be the bank account of a company, which in this case will be an offshore company.
Many international measures have been put in place to guarantee or to try to guarantee, that bank accounts opened abroad are brought to the attention of the tax administration of the country of residence of the account owner.
For example, if you open your offshore account in the European Union, then the country in which you open it has the obligation to declare it to your country of residence. It is the European directive on the taxation of savings of 2003 that provides for this obligation between member countries in its text.
In the same vein, the AEOI, the Automatic Exchange Of Information, is a standard issued by the OECD, which concerns its member states, as well as the so-called partner countries. The AEOI requires that each signatory country declare, once a year, bank accounts opened by foreigners, existing in their territory. This exchange has two characteristics, the first is that it is automatic , that is to say, that there is no need for one country to make a request for information to another, as it was the In the past, the second is that this exchange of information is systematic and intended for all other member countries.
For example, by simplifying to the extreme, imagine that there are 5 AEOI signatory countries (in reality they are more than 100), these countries being named 1, 2, 3, 4, 5. Once per year, country 1, will inform countries 2, 3, 4, 5 of existing bank accounts on its soil, opened by their respective inhabitants. These countries 2, 3, 4, 5 doing the same towards the country 1.
Some analysts agree that the AEOI is putting an end to international banking secrecy, but it should also be remembered that although this standard now includes some 100 signatories, there are still 150 jurisdictions in the world that have not yet joined the AEOI.
Such an account can, of course, be opened by moving you in the country which interests you, but in these lines, it is the method of opening of account by the use of the Internet which will be studied.
Why open such a bank account
For an individual, open an offshore bank account, can take several interests and benefits. Thus, it can be opened in order to shelter capital. Sheltered because these tax havens are economically very stable jurisdictions, or your money will not risk anything. It means that these destinations are dream places to put money out of the reach of justice for example. If the state does not know the existence of some of your assets, and in addition, they are stored in a perfectly stable country, where the big international banks are perfectly established, then these financial assets cannot be seized or frozen by justice.
The second reason to open such a financial product, the fact that tax havens generally have much more flexible banking legislation. The purpose of these offshore destinations is to attract foreign capital, everything is effectively implemented so that banks are as attractive as possible. Thus, perhaps in some of these offshore jurisdictions, the origin of some funds will be less verified than in others. It is not unthinkable that some of these accounts can be used to launder dirty money.
Another advantage is that tax havens are known for their strong banking secrecy, and for the confidentiality of the exchange of funds. Certainly, big names in offshoring have rallied, sometimes a little forced and forced, to the AEOI, but others still benefit from very strong banking secrecy. Thus Delaware, for example, is not a signatory of the AEOI (since it is a state of the United States). A strong banking secret, allowing you to keep safe the most valuable thing that exists in the offshore, your name. There are even some countries that allow to open an account under a false identity, or simply by being identified only by a number. The famous Swiss numbered accounts.
A counter-intuitive advantage of offshore bank accounts is account maintenance fees. Generally, everyone has a tendency to think that this type of account, by its specialization, and the people who are customary, are extremely expensive. In fact, this is absolutely not the case, and simple offshore accounts are often even cheaper than those existing in our countries.
In the same way, even if this time it seems a little more logical, the interest rates existing in tax havens, are generally much higher than those which you could find in traditional French banks.
Offshore accounts also offer the advantage of offering banking services that are not present in France, for example, offshore banks can grant you loans in which the interest rate will be estimated according to the risks of the transaction. They can also allow you to make investments that would not be possible elsewhere. Of course, as there is tax havens, there are several laws, and you will not find all the same benefits, regardless of the destination in which you decide to open your account.
Last major advantage is, of course, the taxation applied to the account in the tax haven. For example, some countries simply do not tax foreign bank accounts. If we add up this absence of taxation, with much higher annual interest rates, it is quite possible, if the sums deposited on the account are large enough, to make very large savings or even non-capital gains. negligible.
So, if you go into one of the needs that have just been mentioned, you must be curious to know how to open this type of account using the internet.
But before seeing how to operate, it is absolutely necessary to remember that to be in conformity with the French legislation, it is absolutely essential that you declare to the Fisc, the foreign account (s) that you will open.
How can we open one?
So how to open such an account. Many providers now have a place on the web, and make every effort to allow you to open an offshore bank account in the simplest possible way.
These providers are in fact intermediaries, who will take the role of a bridge between you, the client, and the foreign bank. These intermediaries work with partner banks so that they can act in the most efficient and fast manner possible.
These intermediaries will offer you a list of countries with which they are accustomed to working, and will be able to advise you as to which one will be most inadequacy with your expectations. Each jurisdiction and each banking group does not offer exactly the same advantages and disadvantages, and therefore, some countries may be more suitable than others depending on the use you want to make of your bank account.
In the majority of cases, you will need to provide certain administrative documents to the service provider so that he can open your account. Thus you will certainly be asked, a photocopy of your passport, proof of address, sometimes a document proving the origin of the funds that you will deposit.
In addition to these documents, it will, of course, be necessary to provide for the payment of the intermediary’s fees online, as well as, in certain cases, the minimum balance depositable at the opening of the account. This minimum balance can be zero but can also be 10,000 €, everything will depend on criteria such as the country in question, the bank, the services offered …
But beware, if these providers are now very numerous, they are not all of the competence to all tests! Or perfect honesty!
As in all sectors that benefit from a fashion or a favorable economic situation, a lot of profiteers and crooks are trying to get into this market. It will not be necessary to rely on the first website that will promise you mountains and wonders for ridiculous amounts. It will be necessary to choose with intelligence, and if possible by relying on the wise advice of people who have already used a particular provider.
If you do not act with common sense, it will be entirely possible that either you never see the trace of the funds that have passed through online, or that you are very poorly informed, and that all a total fiasco. Because if your ultimate goal in this opening procedure is to hide funds to escape the French imposition, it will, of course, be necessary that your anonymity and the entire procedure remain as discreet as possible. To appeal to a company that does not do things in the rules of the art would be exposing itself almost voluntarily to the wrath of Bercy.
Especially since in this year 2018, the French government plans to further tighten the level of control of offshore accounts. The money hidden by the taxpayers is totally unbelievable, and the tax authorities intend to put an end to it.
So this year, if the bill is passed, new tools will be put in place. The staff of tax investigation units will be increased, as well as the current means available to them. It will also be possible to publish the names of offenders in the press, at their own expense, of course. Individuals or companies that have helped set up offshore accounts or businesses may be concerned. Regularization offices will be set up so that taxpayers can denounce themselves. They will thus benefit from some deductions on the sums they will have to regularize.
On the jurisdictional side, a sort of “guilty plea” will be put in place, so that an offender can confess his faults, and thus avoid a trial while paying the sums that the tax will demand. In short, the legal arsenal will be once again complicated, the “data mining”, or exploitation of the various databases of the French administrations will be more and more used.
It will then be much more difficult to open an offshore bank account, whether online or offline.
Once again, if by chance your intentions were at the limit of the legality, it is really opportune to wonder about the real need to resort to an offshore account, as the risks are high.
To conclude, it must be said that opening an offshore bank account online is an extremely simple procedure, but also extremely risky, both at the level of the intermediary itself and the tax administration. This apparent simplicity further reinforces the dangerousness of the thing since, taken from home, it can be accomplished on a whim.