An offshore bank account refers to a type of account that is set up by a non-resident in a foreign jurisdiction. There are various types of accounts, depending on the jurisdiction of interest.
But most common, one can select to: 1) open an offshore business bank account or 2) a personal bank account.
In most of cases, foreigners will set up the account for business purposes, which has different requirements compared to the one created for individuals.
Foreign investors who want to open an offshore business bank account can request in-depth information on how to start the formalities in the offshore jurisdiction of their choice, from our team of financial consultants.
The requirement to have an offshore business bank account is a compulsory part of the process of offshore company formation, regardless of the jurisdiction of choice.
This requirement is part of the incorporation process available in all countries, as each legal entity must have its own, separate bank account where the company can deposit its revenues from the business activities carried out in the respective jurisdiction.
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What are the deposit requirements for the offshore business account?
In selecting a jurisdiction that is of interest for a foreign investor one should also take into account the deposit requirements imposed by the bank.
Please mind that the minimum thresholds will differ based on whether the account is set up for personal or business purposes.
| Quick Facts | |
|---|---|
| What is an offshore business bank account | An offshore bank account for business purposes is the bank account that is set up at the request of a company that is incorporated in an offshore jurisdiction.
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| Types of accounts
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Bank accounts in the currency of the offshore jurisdiction or accounts in foreign currencies such as EUR, USD, CHF, GBP. |
| Deposit requirements (yes/no)
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Yes |
| Deposit – minimum thresholds |
The minimum threshold can vary based on the selected jurisdiction (from EUR 500 in countries such as Puerto Rico to EUR 350,000 in countries such as Liechteinstein). |
| Processing duration of the account | Minimum 2-3 days to 7 days and maximum 20 days, depending on the selected jurisdiciton. |
| Advantages of an offshore bank account |
An offshore business bank account offers many advantages, such as: easy registration process, access to the account from any place in the world, reduced taxes and fees, credit facilities offered to investors, better interest rates than the ones usually applied in onshore countries. |
| Tax exemptions in offshore jurisdictions | Offshore jurisdictions are known for not applying taxes such as: the corporate income tax, the inheritance tax, the capital gains tax, the withholding tax on dividends, interest or royalties.
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| Corporate documents to submit |
Identity documents of the shareholders and directors, completed application form, the certificate of incorporation of the company, the statutory documents (articles of association and the memorandum of association), the initial deposit established by the bank of choice. |
| Certificate of good standing required (yes/no) | Yes, in certain cases (for companies that haven’t been incorporated recently). |
| Legal representation allowed (yes/no) | Yes |
| Document for granting legal representation | The power of attorney |
| Main jurisdictions for opening an offshore bank account |
One can open an offshore business bank account in jurisdictions such as: Belize, Switzerland, Seychelles, Nevis, Panama, Singapore, Puerto Rico. |
| Offshore bank account for personal purposes | Foreigners can also set up an offshore bank account for personal purposes. |
| When it is recommeded to have an offshore bank account | When establishing a business in an offshore country or when one relocates to an offshore jurisdiction for various purposes. |
| Fees charged for the account |
Banks will charge a fee for the setup of the account (EUR 200-300 for personal accounts and EUR 500 for the offshore business bank account). |
Regardless of the bank of choice or the jurisdiction, when one will open an offshore business bank account, the deposit thresholds will always be higher compared to the ones imposed for personal accounts.
In the following list, you can find out some of the differences in deposits applied by different countries:
- 1. in Cyprus, the minimum deposit is of EUR 500;
- 2. in Liechtenstein, the deposit has a very large value, of EUR 350,000;
- 3. in Mauritius, one can open the account with only EUR 500;
- 4. in Switzerland, the minimum deposit has a value of EUR 10,000;
- 5. the processing of the papers in order to open the account can take approximately 7 to 20 days, depending on the jurisdiction.
How can one open an offshore account in Mauritius?
Mauritius is a famous offshore jurisdiction, that attracts numerous investors for a wide range of reasons, including the very favorable tax system.
Foreigners have the possibility to open an offshore business bank account in Mauritius, by preparing the required set of documents (each bank can have its own set of rules, but in most cases, there will be the same requirements).
Those who will open the business account should prepare the following: 1) the passport copy of the director and shareholder, 2) the proof of address of the director and shareholder, 3) the resume of the shareholder and director.
The procedure to open an offshore business bank account requires business owners to provide the company’s documents.
In this sense, investors must prepare: 1) the certificate of incorporation, 2) articles of association, 3) the company’s resolution, 4) the resolution of the directors, 5) the share certificate and others.
Where the account is necessary for companies that have been incorporated for more than 6 months, the investors have to prepare the company’s certificate of good standing too.
It is necessary to remind you that all the documents have to be translated and notarized.
Please know that it is also not required to be present in person. If you want to open an offshore business bank account, our team of financial specialists can provide legal representation.
This can be done, of course, with the proper documents – here, the investors can draw and sign the power of attorney, a document which will stipulate the exact ways in which our team can represent foreign clients.
It is important to know that in most of the offshore jurisdictions investors will have to prepare the same documents presented above.
For more details on how to open an offshore business bank account, we invite you to contact our team via e-mail or by phone. Our team can also help you set up a personal bank account in your name or for a family member.
We invite you to contact our team if you need assistance in setting up an offshore merchant account. The merchant account is a different type of account than the one set up in the name of the business.
This allows a company to sell products on their online platforms to international clients, and thus, there are different requirements to open this type of account and they can vary based on the jurisdiction or the products sold.