What is an ‘Offshore Bank Account’?

What is an ‘Offshore Bank Account’?

 

An offshore bank is a bank located outside the country of residence of its depositors, with most of its account holders being non-residents of the jurisdiction. An account held in a foreign account, especially in a tax haven country, is often described as an offshore account. Typically, an individual or company will maintain an offshore account in a low-tax jurisdiction (or tax haven) that provides financial and legal advantages, such as:

  • greater privacy.
  • little or no taxation (i.e. tax havens).
  • easy access to deposits (at least in terms of regulation).
  • protection against local, political, or financial instability.