Deciding to Open a Bahamas Bank Account
Learn the benefits of a Bahamas bank account. Many people choose to open an offshore bank account to protect their assets from turmoil in their own countries. Others choose to keep money there to protect their own privacy or to safeguard their money's value from fluctuations in the value of their home country's currency. Banks in the Bahamas offer all of these benefits in a country that has a stable economy and political system, as the Bahamas are part of the British Commonwealth. Financial services account for a large part of the Bahamas' GDP. This makes the government inclined to protect laws that favor this industry and, by extension, account holders.
Assess your need for this account. Before opening a Bahamas account, you should consider how much you really need this type of account. Bahamas savings accounts may offer higher interest rates than American ones or those in other countries, but investment accounts offer similar returns. In addition, unless you are currently experiencing political or economic turmoil in your home country, these accounts are no safer than those closer to home. That said, an offshore account can a step towards making yourself independent of your home country (if you are planning on moving) or a useful step to take when moving to the Bahamas. In addition, you can keep up to $10,000 in an offshore account without reporting it (though you still have to report earnings on the account).
Be aware of the tax requirements. The Bahamas is slowly becoming compliant with the US tax system. For now, they rely on a sort of honor system, where your foreign holdings and earnings will not be reported to the IRS (or the tax authority in your home country). However, you are still responsible for reporting assets (over $10,000) and any earnings in foreign account to IRS when you file your taxes. Foreign accounts, if you have over $10,000 in all of them combined, must be reported on an FBAR (FinCEN Form 114) if you live in the United States. Your earnings on foreign accounts will be taxed as either income or capital gains (depending on the nature of the account). Failing to report foreign assets or earnings constitutes tax evasion.
Consider opening accounts in other nations. While Bahamas accounts offer a number of benefits, you may find that your money will be more easily accessed or have more earning potential elsewhere. Alternately, you may want to diversify your accounts even further and open accounts in several different countries. Many countries across the World offer bank accounts to US citizens without much trouble, including: Switzerland. Swiss bank accounts are perhaps the most famous type of offshore account. They offer legendary privacy and world-leading service. Other Caribbean islands. The Grenadines, St. Vincent, and Turks and Caicos all have thriving financial industries. Mongolia. A fast-growing economy, Mongolia offers impressive interest rates that may be up to as high as 13 percent. Hong-Kong. Some multinational banks (like HSBC) offer accounts in Hong-Kong, giving foreigners access to investment opportunities in China. In addition, accounts here are cheap and generally come with quick service.
Choosing a Bank
Determine which type of bank you need to use. The bank you choose will depend on your financial goals. There are many private banks that offer investment accounts to foreigners without their being in the country. These accounts will have large minimum deposits, likely in the tens or hundreds of thousands dollars, and will seek to offer larger returns to foreign investors. However, if you are moving to the Bahamas or doing business there, you will need a local checking account. These will offer you easy access to your money and a debit card to facilitate transactions.
Locate several banks that meet your needs. After determining your needs you can begin to locate banks that have a presence in the Bahamas and can accommodate you. This is simple if you already have an account with a large multinational bank, as you may be able to open your account in advance from a branch in your area. Large banks active in the Bahamas include HSBC, Barclays, Citibank, and Scotiabank. The largest local bank is First Caribbean International Bank. This bank and other local banks are eager to offer accounts to foreigners. Private bank accounts can be opened with a number of private banks. Some Swiss banks also have a presence in the Bahamas, including UBS and Credit Suisse. Other private banks operating in the Bahamas include Ansbacher, Corner Bank Overseas, Finter Bank & Trust, and Guaranty Trust Bank.
Contact the banks for information. Each bank will have a slightly different procedure and set of documentation requirements, so contact the banks first so that you can be provided this information. Ask about whether you have to be present to open an account and, if not, how you can open one remotely. In addition, ask about any account specifics, such as minimum deposit amounts and fees (annual fees, transaction fees, or others). For example, if you planned to live in the Bahamas, you would want an account that offered reduced ATM fees and free local transactions. Gather information from more than one bank so that you can compare them.
Choose your bank. Eliminate any banks that seem unprofessional to you when you contact them. Then, cut out any that you can't afford because of high minimum deposits or fees. Finally, compare the services and reputations of the remaining banks to make your choice. When you've decided, you're ready to begin the process of opening the account.
Opening Your Account
Gather the required documents. There are certain documents that will likely be required when opening your account. These are largely for identification and should not be hard for you to get a hold of. In general, you will need the following: Government-issued identification, like a passport or driver's license. Proof of residence, like a utility bill or some other document showing your home address. Other documents as required by the bank.
Open your account remotely. For many types of accounts, you will be able to open them without actually visiting the Bahamas. The bank should have clarified this with you when you contacted them about the account. Either work through a branch office for the bank if you've chosen international bank, or communicate directly with the bank to set up the account. In some cases, you can also work with a law firm or financial advisor in your country and they will open the account for you and take care of the paperwork. Opening an account through a representative (like a law firm or financial advisor) is only advised if you plan on opening a private bank account or setting up a business structure in the Bahamas. Otherwise, taking this route may be cost-prohibitive.
Meet with a banker. If you have to open the account in person or choose to do so, you will have to set up a meeting with a banker either by calling ahead or by simply walking into the bank. Be sure to bring all of the documents that you need to open the account so that you don't have to come back. Most bankers will request your documents and the following basic information: Your legal name. Date of birth. Address. Citizenship and country of residency. Your occupation.
Provide other information as necessary. In some cases, you may be asked to provide additional information or documents to the bank. You may need notarized copies of some documents you have already submitted. Alternately, you might be asked to provide six months or a year's worth of bank statements to prove your good standing with your old bank. In other cases, you may be asked to provide a document proving the source of the money you are depositing. This is a measure intended to prevent the bank from taking on money obtained through illegal means. For example, if your money were obtained through the sale of property, you would need to provide a sales contract for that transaction.
Choose a currency for your account. For some accounts, you are able to choose the currency in which your account balance will be held. For example, if you wanted to hold an account balance in US Dollars or Swiss Francs, rather than in your home currency, you could specify this. Doing so can protect you from fluctuations in the value of your home currency. However, keep in mind that there may be fees for converting your money to this currency, for example when you deposited and withdrew your money. Check with your bank to ask about this option and inquire about fees for converting your money.
Supply your initial deposit. After you've provided all of the required information and documents, you only need your initial deposit to finish opening your account. If you are opening the account through the mail or an intermediary, the deposit can be wire transferred from another bank or submitted as a check. You may also use cash if you are opening your account in person.
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