The Advantages Of Offshore Banking In Hong Kong
Posted on November 4, 2017
Hong Kong’s stable banking industry is the main draw for foreign non-residents to open an offshore account there. Its prominence in the Asian region is undeniable, as established by an overview of the Hong Kong banking industry to date.
- As of September 2016, Hong Kong placed fourth in the Global Financial Centres Index (GFCI) by the Z/Yen Group.
- The country follows the top three financial center leagues in the world namely New York, London, and its regional neighbor, Singapore.
- As of December 2016, Hong Kong is home to 195 licensed institutions of which 22 are restricted licensed banks, while 17 are categorized as deposit-taking companies.
- The current number of foreign banks with representative offices in the country is 57.
Benefits of Opening a Hong Kong Offshore Account
Opening an offshore account in a country like Hong Kong presents numerous benefits beginning with privacy, tax efficiency, and more.
- The confidentiality of your account and transaction details are guaranteed, as the country has strict privacy laws in place.
- Hong Kong’s efficient banking system makes it easy for you to access your account whenever and wherever you are.
- The country has the 4th fastest Internet connection in the world.
- You can access your account through the internet or phone banking.
- Account holders also enjoy favorable taxation as bank accounts in Hong Kong are not taxed on interest
- A capital transfer is free. Hence, you can transfer profit or dividends to your home country without limit.
- Individuals or businesses doing business with Mainland China have access to better Renminbi (RMB) trade settlement.
- The option to obtain and retain RMB trade receipts is accepted.
- Exchange cost is reduced when buying and selling Renminbi (RMB).
The reputation of Hong Kong’s banking industry is the key reason why it is often the top choice for offshore banking among foreign individuals and companies.
Contrary to what many people think, having an offshore bank account is 100% legal. However, expats are strongly advised to consult with their financial advisers to know whether the circumstance comes with any liability. For those who already have an offshore account, it is important to file a FBAR (Foreign Bank and Financial Accounts) every year in line with FATCA. Again, you need to consult a financial expert to correctly file the financial report.
If your application for a bank account in the country of residence has been denied or you live a nomadic lifestyle, offshore banking might be the best idea for you. It is a legit move as far as you comply with all the rules back at home and the country of residence. Do not let the myths about offshore baking and current laws stand in the way of enjoying the benefits of offshore banking. Work with a financial expert and pick the best bank in a great jurisdiction such as Hong Kong.
Its stability, liquidity, and efficiency guarantee the security of your finances.