Withdrawal of funds from corporate account
Unfortunately, some clients believe that if they open a corporate offshore bank account and personal bank account with the same or another foreign bank, they will be able to transfer money from the corporate account to the personal one as they please. Meanwhile, offshore banks pay more attention to and try to understand the economic meaning of transactions from your corporate account exactly to accounts of individuals. It is advisable to give those transfers a meaning that will be comprehensible to a bank’s department of financial operations monitoring. There are several possible payment explanations that will most likely be favorably taken by foreign banks.
Mainly, transfers to individuals’ accounts are allowed by foreign banks in the following cases:
- Transfer of salaries, royalties, pensions, alimonies or social benefits.
- Transfer of funds between accounts of one individual to other banks. You can transfer money from your personal account in your country to your personal offshore banking account. If all taxes are paid and you have nothing to worry about, then the transfer to a foreign bank is done. After that you can transfer the money to other banks and invest them at your discretion.
- Payment connected with inheritance or gift. You can receive money transfers from your relatives, friends or benefactors. If money is transferred from a personal account, then a bank may have questions in case of large amounts exceeding initial and planned balance multiple times.
- Payment for realization of personal property owned by the holder of a personal offshore account. In this case you can receive payment from an account of an offshore company by selling a house, building, car or office furniture.
- Any one-time payments that have nothing to do with commercial and/or other like activity of an individual. For instance, money on loan or assistance. As the owner of an offshore company you can borrow money from it.
In order to make transfers of over USD 30,000.00 (or equivalent in another currency) for commercial purposes (payments for goods, services, etc.) to and/or from an individual you should beforehand provide the bank with supporting documents, for instance, copies of contracts. If you have a personal relationship manager, you may consult with him before making the transaction.
When opening a personal offshore bank account https://www.offshorecompanyregister.com/offshore_account.php you specify amounts of incoming and outgoing payments. Any foreign bank will certainly like it more if amounts of incoming payments are larger than those of outgoing payments. Of course, the proposed amounts and nature of payments may change and the bank can ask you to sign a new contract or send it an updated questionnaire. If the transactions do not correspond with the specified amounts, this will draw the attention of the bank’s monitoring department and some of your incoming payments may be temporarily blocked until you provide precise information. Therefore carefully fill in the form for offshore bank account opening specifying estimated amounts of transactions.
If you hold a corporate offshore banking account, then you can withdraw money to pay your employees bonuses or for personal expenses not only through a personal bank account but also through a corporate payment system. The latter may even be organized using anonymous bank cards.
When making payments of USD 50,000 or more (or equivalent in another currency) for consulting, marketing research, periodical and/or one-time analytical reports and forecasts you should beforehand provide the offshore bank with contracts and supporting documents (via e-mail). Payments for services and securities from a corporate account undergo additional monitoring of foreign banks as it is difficult to find out whether some service is necessary for an offshore company and to substantiate purchase of unknown issuer’s securities.
Any foreign bank has the right to request additional information and documents for economic justification of an international or domestic transaction.
In cases where a foreign bank asks for additional information or documents concerning the client or some of his transactions, he should hurry up to provide them. A bank may make such a request in case of incoming or outgoing payments of unusual amounts on a personal or corporate account. It is always better to provide such information beforehand and anyway not later that in 2 business days. When working with a foreign bank it is always easier to prevent difficulties than thereafter draw up contracts at the most inopportune moment.