Looking to save some money? It might be time to consider taking that money offshore.
By now, you’ve likely heard of offshore business accounts. Opening an account is a useful strategy that can save you big money when it comes to taxes.
That is especially true for people in the midst of offshore company formation.
But it’s important to understand the basics before opening an offshore account. You need to be prepared with the right balance, account, and interest rate to set yourself up for success.
A crucial part of offshore company formation is opening an offshore business account.
Read on for a quick guide on how to open your offshore account.
What is an Offshore Company?
Offshore companies are companies registered outside of their country of operation. An Offshore company formation can make for easier business transactions between partners in different countries.
There are a number of benefits to starting a Nevis Business Company. For instance, it is a simple way to encourage international trade, simplify accounting, and hold large sums of money.
Really, though, the main benefit is the reduction in taxes. Offshore companies enjoy a number of tax breaks that you might not enjoy in your home country.
Nevis Business Companies do not have to pay corporate income tax, capital gains tax, and other binding taxes.
That’s a big benefit when you consider small businesses average effective tax rate is 19.8 percent in the U.S.
These tax breaks don’t apply to all income. For example, income from clients is still taxable in areas where clients are tax residents.
Nonetheless, offshore companies are still a go-to for businesses.
The truth is offshore accounts operate similarly to bank accounts in other countries. In fact, deposits into these accounts receive interest like in your country of domicile banks. Interest rates vary based on the form of currency, size of the deposit, and the type of account.
You can typically make deposits in three types of accounts: demand deposits, savings, and term deposits.
An offshore bank might also have minimum balances for different types of accounts, so make sure you have enough saved up.
Minimum balances for a Nevis Bank account are usually between $200-$500 based on the type of account.
Offshore banks might also charge you start up fees. It’s recommended that you account for several hundred dollars for opening fees.
Additional fees might include an application fee, annual service fees, and wire charges.
Many offshore banks also offer credit cards on a cash collateralized basis. Credit limits and conditions vary.
Your Offshore Company Formation
Offshore business accounts are a must for any offshore company. They can be your ticket to fast savings, easier business, and tax breaks.
Are you looking to start an offshore company? We can help. Contact us to learn more about setting up an offshore account today.