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Non-Resident Account

Non-Resident Bank Accounts


A non-resident account is an account in a financial institution that is owned by persons or institutions from outside the country in which the financial institution is chartered.


Financial Institutions that cater to persons or institutions outside of the country in which the financial institution is chartered are called a "B bank". A non-resident account can also be referred to as a foreign account.


Friendly To Foreign or Non-resident Accounts


Being "friendly to foreign accounts", or "friendly to non-resident accounts" simply means being willing to accept business from persons and institutions from outside the country in which the bank is chartered. Tens of thousands of foreign persons have US bank accounts in US commercial banks that are "friendly to foreign accounts".


Why choose a Non Resident Account?


While previously it was thought frivolous or expensive to own a bank account abroad, advancements in financial technology have made this much easier, and many in this day and age in fact find it more cost effective to locate their finances abroad while managing them online.


For many a worry of maintaining a non resident account is not having direct access to funds and not being able to deal with a 'real person'. With the event of the 'credit crunch' and the financial crisis that has affected much of the developed world, personal and business investors have instead begun to see non resident accounts as a safe haven. Unsecure of the ability of banks in their own country to have money, more and more are turning to non resident accounts which guarantee their deposits by not lending and leveraging extortionately.


US Non Resident Bank Accounts


US non resident bank accounts offer advantages for non-us citizens and residents. These are principally those who conduct business globally or online, and wish to send/receive payments in US dollars or those who service a large US client base. For others, US non resident accounts may offer asset protection, especially for residents of economically and politically unstable countries.


Accounts for Non Residents Offshore


Citizens from the US and EU typically look for non resident accounts to take advantage of favourable tax treatment, greater economic freedom, and easier access to their funds overseas.


The challenge for US and EU citizens who would like a non-resident account is to find a jurisdiction that has not been declared an "offshore financial center" by the US, and thus not subject to unwanted attention and invasions of financial privacy.


The most dangerous threat to financial privacy in recent years has come from the Patriot Act. It requires any bank with a US Dollar correspondent account to hand over customer information on demand, regardless of the privacy laws in that country and whether or not a transaction is suspicious. Furthermore if a country has a tax-information treaty with the US, that country's law can be overridden to gain access to their confidential account information. This means that even those who do not hold a US bank account, for reasons of privacy, may find themselves under attack regardless.


Another attack has come from the EU savings tax directive, which requires all banks in EU countries and their dependencies to report customer's income to their home country, or deploy a withholding tax. This directive therefore has influence over a host of tax havens which are EU dependencies such as the Channel Islands, the Isle of Man, the Cayman Islands and Gibraltar among others. The pressure to farm taxes has grown to such an extent that even Switzerland, former bastion of secrecy, has opened the castle gates and is now paying withholding tax to the EU for a foreign depositor in a swiss bank account.


Further demands have originated from the OECD which has published a blacklist of 'un-cooperative' tax havens. Bureaucrats are currently busy compiling a new list to be published sometime in 2009.


The key is to recognize that the offshore environment is constantly evolving. The world political and economic climate is too volatile and complicated to simply assume that a bank that was "safe and private" last year still meets those requirements.


Capital Conservator limits the risk of its clients by holdings accounts in non-blacklisted jurisdictions that are not signatories to tax treaties with high tax countries. In addition it keeps multiple accounts in multiple countries so that should problems arise funds can always be swiftly and seamlessly transferred to safety.


Non Resident Tax and Income


A non resident account can offer welcome benefits where tax is concerned. Depending on your residency and citizenship, funds held in an offshore non resident account may not be taxed. In addition some non resident accounts offer higher interest rates or access to high interest bearing bonds and CD's that may not be available in your home country.


For those who choose to invest their income in a non resident or offshore account one of the main problems is repatriating these profits from their bank accounts without adverse tax implications. It is not advised to send back large un-taxed wire transfers from an offshore account to a bank account in your home country.


Many instead choose to hold a non resident bank account for their business, and to hold the bank account in the name of a company. Payments for expenses, employee salaries, and new equipment can then be legitimately sourced from the account.


Non Resident Bank Card or Debit Card


Another way of gaining access to your non resident account can be through an offshore debit or bank card, which can allow you to access your funds anywhere in the world while the account remains tax free in a different country.


Capital Conservator offers a variety of private bank cards, private access to funds and can be used at more than one million ATM machines and 3 millions merchants worldwide.


Which Non Resident Account is Best for Me?


Click for more information on Capital Conservator offshore accounts.


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