Today, June 2nd, is Tax Freedom Day in the UK. Tax Freedom Day is the day on which we stop working for the Chancellor and start working for ourselves. So if the average person works from the first of January each year, it will be June before they have earned enough to pay their taxes.

Every major country has its Tax Freedom Day, usually calculated by free marketeers who are still resident there and thoroughly annoyed at having to pay so much tax. Tax Freedom Day is defined by Wikipedia as “the first day of the year in which a nation as a whole has theoretically earned enough income to fund its annual tax burden.”  All taxes are included in the calculations, not just income tax. In recent years governments have introduced many so-called stealth taxes.

One thing that is not included in the calculation, however, is the ultimate stealth tax – inflation! And devaluation (The many Brits who own second homes abroad will certainly know what I am talking about here! No economics training required!)

Fortunately, all this only concerns me in passing. Although I was born a Brit, I’m no longer in the UK. Haven’t been for years. Like all UK non-residents, I am not obliged to file a tax return unless I happen to have income in the UK. The same deal applies to citizens of every other country in the world, with one big exception: the USA.

US citizens are required to file tax returns with the IRS wherever they happen to live in the world. Even Americans, however, get the benefit of a complete exemption on the first $85,000 of earned income each year. Not bad for starters. So even Americans can – by using offshore corporate structures, trusts, foundations and the like – pretty much avoid all taxes legally by moving offshore.

There are lots of reasons in this day and age to go offshore which have nothing to do with taxes. I am very fond of telling socialists I meet that most of my clients these days go offshore for reasons that have nothing to do with taxes.  They end up having to agree with me, because they too are sick of big corporations and governments taking away our freedom, privacy and civil rights.

When you make that move to become an expat and start to receive your income through an offshore company, you simplify your life so much. No need to waste time keeping records of expenses and tax deductions. The simplicity of working for money, then keeping it, no questions asked, feels like an incredible burden being lifted off your shoulders. If you haven’t tried it yet, you really should! You will enjoy it.

The good thing, though, is that the news is out. You can opt out of unfair taxation. The number of people who are opting out of the tax system altogether, simply by going to live – at least part time – in a country where they can legally carry on their lives and businesses without paying tax. Examples of these countries would be Panama and Belize, amongst others. You can read more about both Panama and Belize, as well as other personal tax-free residence havens, by browsing this very site.

Meantime, would you like to hear some secrets? Would you like to know how to use offshore banks to protect your assets from greedy governments, you could do no better than starting here at my blog. If you feel I could help you individually, remember I do free consultations for members of The Q Wealth Report. There’s a lot more stuff going free too if you are interested in reading more about this topic… like our FREE Offshore Banking and Asset Protection E-Mail Course in association with Q Wealth Report. Have fun – and if you’re in the UK, at least you can breathe a sigh of relief! Come join us offshore soon though.

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I was back in Panama City last week and one of the most interesting meetings I had was with a young man who is setting up a new bank in Panama from scratch, almost single handedly! Right now he spends his days meeting with lawyers, other Panamanian bankers, bank regulators and contractors who are working on installing everything from the floor tiles upwards in the building that will shortly bear the name of his new bank.

Single handedly? Well not quite. What he is actually doing is opening the new Panama subsidiary of his employer, a European boutique private bank that is looking to expand their existing presence in Latin America.

What I liked is the breath of fresh air this will bring to Panama’s rather staid and conservative banks with their ‘take it or leave it’ attitude. For example, they will be offering multi-currency accounts, allowing you to hold 30-plus international currencies in just one account, with one account number and one login access for the internet banking. They are also introducing a customer-focused approach, something that is sorely lacking in Panamanian banks at the moment.

Right now this bank is still not open. They expect to open in 4 – 6 months with full banking facilities including a street level walk-in retail bank with tellers. (In other words this will be a real bank, not just a represenative office.)

However, if you are going down to Panama in the next few months you could certainly meet with this gentleman and start the process of opening your Panama bank account. Feel free to contact me and I will be happy to introduce you. The only condition is that this service is limited to QWR subscribers. There is no charge for personal account introductions, but we do make a nominal charge of about $1000 for corporate account introductions (Panama corporations and foundations, but also IBCs and Trusts from other jurisdictions are acceptable.)

Don’t miss out on this excellent opportunity to open your bank account in Panama!

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These days, we are all accustomed to doing almost everything online. There cannot be too many of us left who are nervous about using a credit card online, for example. Doing business online is a way to save time, money and headaches. Investing through online brokerage accounts promises much the same benefits.

However, when it comes to investing offshore, borders still pose a significant psychological barrier. There is no longer any real need to have your online brokerage account in the same country you live in, but it seems investors are still reticent about opening brokerage accounts in foreign countries.

An increasing number of financial service providers are offering cross-border online investment services. This trend has caught on more in Europe than in North America, with larger online brokerages like Saxo Bank and Swissquote offering services specifically tailored to investors from outside their home countries.

However North American investors are also becoming more adventurous, opening more and more accounts with foreign banks and brokerages. Such accounts may be opened as individual US citizens or, more commonly, through offshore corporations or trust structures designed to provide an additional level of privacy. However, the main reason for accessing these international markets is to benefit from more profitable cross-border investment opportunities, and diversify risk by spreading their portfolios across different institutions in different base currencies.

These sophisticated investors have potential access not just to a wider range of investment opportunities – but to simplicity, tax savings, and greater control over their portfolios. There is also the opportunity to save money, by gaining access through discount brokerage models to exchanges that would otherwise have to be traded by telephone through far-away correspondent brokerages.

The current economic climate means a lot of investors love the idea of being able to keep a much closer eagle eye on their internationally-diversified portfolios. But, there remains a concern. Is investing through online offshore brokerage accounts safe?

Are Offshore Online Bank and Brokerage Accounts Safe?

In short, the answer is yes, provided you apply normal common sense precautions. The internet allows you to buy and sell foreign securities through overseas brokerage accounts with just as much ease and security as paying your home electricity bill – and in many cases, much greater security.

The first of these precautions is to invest via a reputable firm. Do some due diligence on the company behind the service. Just as you should at home (but many people don’t) check references, make sure the broker is registered and in good standing with the relevant regulators, speak with them in person and find out what experience they have. You should also enquire about the security arrangements on their site, and what protection they offer in the case of DDOS and other types of hack attacks. Many offshore brokerages are actually fully licensed banks, which makes them more secure and makes due diligence easier.

Once you have decided where to open your brokerage account, it is important that you you’re your own precautions to ensure that nobody else will be able to access your account without your permission. Make sure that your security software, like anti-virus and firewalls, are properly installed, functioning and up to date. Consider using an encrypted VPN solution, especially if you are partial to doing your trading from a laptop connected via wifi, which is notoriously insecure.

Also remember that just like those anti-phishing warnings from online banking at home, offshore brokerages will not email asking for you to confirm your details. If you receive any correspondence via email, confirm it by phoning the company directly before clicking on any links or taking any action. Try to get to know a single executive in the brokerage who will recognize your voice over the telephone.

What Services Do You Need?

Just like at home, overseas investing services can vary wildly in terms of costs and features. Even within the same brokerage, there are often different packages available. Fees may differ significantly depending what features, information and access you request.

If you are considering investing in European bonds, unit trusts, ISAs or funds then you probably will not need access to the type of ‘offshore day trading’ account like Thales Securities in Panama that permits you to buy and sell individual stocks in real time.

A so-called ‘fund supermarket’ type account offered by a European bank would suit you in this case. But be sure to check which products of which fund managers are available, and whether the broker is prepared to negotiate fees or rebate commissions they receive from fund managers (many will, especially on larger amounts, but only if you ask them) .

Other banks and brokerages will offer discretionary management of your portfolio. This is suitable for investors who don’t want to have to watch their accounts every day, and who are looking for more of a Swiss-style ‘private banking’ feel in their brokerage. Having access to quality investment advice is of great importance in this case – so ask what kind of management skills the bank has access to in-house. Larger banks have more expertise, but they may be busy chasing bigger fish. Smaller boutique private banks and investment managers often offer a much higher level of personal service.

In turn these various institutions will often target different types of investor. The more questions you ask your broker or banker before you get started, the more benefits you will obtain from the account you finally choose.

If you take the time to do your homework, investing offshore and online is not only safe but it can be very profitable, cutting costs, diversifying risk, and taking charge of your own future. Are you ready for the challenge?

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Are you thinking about Panama as an offshore tax haven? Or maybe for an e-commerce business? It certainly has a lot to offer. Banking, Corporations, Private Interest Foundations, and more. Although Panama has been targeted by the OECD and the G20, I don’t frankly expect much to happen. Panamanians, like most Latin Americans, are good at promising things and then putting them off until “manana” (tomorrow)!

This could be great, or it could be not so good. It really depends on the way you look at it. For privacy and confidentiality it’s certainly good. On the other hand, if you are used to doing business the North American or European way, you might find Panama too laid back.

I’ve just finished a completely new e-book on this subject: “Eight Important Things You Should Know Before You do Business in Panama.” I’m offering it absolutely free for a limited time, in association with Q Wealth Report. As we say on the page at Q Wealth where you can claim your Free Panama Offshore Report:

So how do you know where to get started? Whom can you trust? Panama seems to be full of lawyers, company formation agents and even realtors eager to sell you Corporations and Foundations, with little practical information on how to use them. How do you tell the good lawyers from the bad? What can you really do with the bunch of papers in Spanish that you will receive? And is Panama right for you, when compared to other offshore tax haven jurisdictions?

It’s a serious matter. If you are thinking of investing your offshore nest-egg in a Panama bank, or entrusting your financial and personal asset protection strategy to a Panama lawyer or law firm, you need to read this report first. Considering it’s free, there’s no reason why you wouldn’t sign up for it right now, I presume? It may not be free for much longer!

Here are just a few of the things you will learn in this FREE PANAMA REPORT:

• A very important question that most foreigners should ask their Panama lawyer but don’t – and how dealing with lawyers in Panama is NOTHING like dealing with lawyers back home

• Why nominee directors really have more control of your company than promoters of offshore services will tell you… why this is not good… and a simple but effective way to protect yourself from this nominee director risk.
  

• Is it really possible to open bank accounts by mail in Panama banks?

• Things you should and should not say when you visit your Panama offshore bank

• A very important fact you should know about Bearer Shares before you decide whether you really want one of those anonymous Bearer Share corporations.
  

• Minimum opening deposits in Panama banks. Which banks have low minimums? Which banks have high minimums?
  

• Which banks in Panama specifically are the best and worst for foreigners? Which will and will not accept US citizens as account holders?
  

• Gold bullion (gold coins, gold bars etc) is the ultimate in solid money to protect your assets from inflation. Can you buy it in Panama? Is it a good deal?
  

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Today, the first of May, workers of the world unite to celebrate what in England we call the May Day bank holiday. But there is a “dark side” to all this – the victims of socialism who are often forgotten by the mainstream media. I’m talking, of course, about the poor, downtrodden taxpayer!

I was reminded of this by a recent blog posting from Vera Verba called Unseen Victim: The Taxpayer at Q Wealth Report. Politicians, points out the posting, are famous for hiding the victims and exaggerating the benefits. Anyone who objects (or avoids or evades taxes, perhaps by opening a Swiss or offshore bank account, is portrayed as  “cold, heartless and cruel” by the media. The great quote on this comes from the economist and scholar, Thomas Sowell:

The welfare state is the oldest con game in the world. First you take people’s money away quietly and then you give some of it back to them flamboyantly.

Perhaps instead of the Workers Day, we should be looking at Tax Freedom Day. Tax Freedom Day is defined by Wikipedia as the first day of the year in which a nation as a whole has theoretically earned enough income to fund its annual tax burden.  Every dollar that is officially considered income by the government is counted, and every payment to the government that is officially considered a tax is counted. Taxes at all levels of government—local, state and federal—are included.

You can find examples of various tax freedom days on that Wikipedia link. Very few countries on the list have a tax freedom day before April. The United States Tax Freedom Day is – perhaps surprisingly to some – relatively early in the year, at April 13th. That still means all Americans work more than a quarter of the year just to keep the government going.

The UK’s Tax Freedom Day fell on June 2 last year. That means that the poor Brits (the ones still left in the UK, that is) are spending more than five months of the year working for the Chancellor, rather than working for themselves!

Yet pity the poor Norwegians, who will have to work until July 29th to cover their tax burden!

There are lots of reasons in this day and age to go offshore which have nothing to do with taxes. In fact, as I frequently point out, most of my clients these days go offshore for reasons that have nothing to do with taxes.  When you become an expat and bill out your services through an ofshore company, you simplify your life so much. No need to waste time keeping records of expenses and tax deductions.

Most people would probably not object to a fair, low, flat tax. But if like me you think the way our governments spend money today is nothing short of evil in many cases, then paying tax really hurts, doesn’t it?

On a more positive note, the good thing is that the news is out. The Tea Parties – peaceful anti-tax protests across the USA – are a very encouraging sign. Perhaps even more significant, but less reported in the mainstream media, is the number of people who are opting out of the tax system altogether, simply by going to live – at least part time – in a country where they can legally carry on their lives and businesses without paying tax. Examples of these countries would be Panama and Belize, amongst others. And a good site where you can read more about such tax-free havens is Offshore World.

If you would like to know more, meanwhile, about how to use offshore banks to protect your assets from greedy governments, you could do no better than starting here at my blog. If you feel I could help you individually, remember I do free consultations for members of The Q Wealth Report. There’s a lot more stuff going free too if you are interested in reading more about this topic… like our FREE Offshore Banking and Asset Protection E-Mail Course e-mail course in association with Q Wealth Report. Have fun – and don’t feel too downtrodden today. There is help at hand. So don’t forget the victims – the taxpayer.

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Guest Post for Peter Macfarlane by Martin Hutchinson Contributing Editor Money Morning

Peter’’s note:  As you probably know I have a pretty hectic work and travel schedule doing at least four jobs: bringing up my kids, editing the Offshore Banking Guide at The Q Wealth Report, flying around the world meeting my private consulting clients, and now I’m working on a major new real estate project with Thomas Bolther too. And then I have a load of reports I am scheduled to write! So sometimes a good article comes along from an associate and I would like to publish it for my readers’ benefit. Such is this press release put out by my friends at Money Morning recently which is preceded by a little well deserved publicity…

$4, 201 Cash Guaranteed Next Month …Yours For The Taking! Martin Hutchinson has uncovered a special group of investments set to pay out $4,201 guaranteed cash next month. Plus, they pay out juicy cash sums all year long. And they’re not income trusts, corporate bonds, or foreign bonds. In fact, remarkably, no one else is talking about them. But you must act by April 26. Read Martin’s full report here…
One of the most accurate forecasters of the global economic crisis, Nouriel Roubini, said last week that last September’s spree of bank takeovers deepened the crisis because it made the already-too-big banks even bigger.

He may well be right; more interesting is what this tells us about the U.S. banking system going forward.

“The institutions are insolvent,” Roubini said in a Bloomberg Radio interview. “You have to take them over and you have to split them up into three or four national banks, rather than having a humongous monster that is too big to fail.”

But that may be impractical. Citigroup Inc. (C), for example, can sell and is selling peripheral parts of its empire such as Japanese broker Nikko Securities. However, so much of its business involves an international nexus of connections – including its large U.S. operations – that splitting them may be both impractical and excessively value destroying.

However, Wells Fargo & Co. (WFC) showed Thursday what could be achieved by simplicity. It gave investors a preview of its first quarter results, in which it will make record earnings of about $3 billion, or 55 cents a share, after paying preferred stock dividends of $372 million on its $25 billion of preference shares from the Troubled Assets Relief Program (TARP).

Both the old Wells Fargo and Wachovia Bank, which it acquired last year, are showing good results, with $3.3 billion in loan-loss charge-offs for the combined group – down from $6.1 billion in the fourth quarter of 2008. As a result, bank stocks were up sharply Thursday, continuing their healthy rally over the last six weeks.

Wells Fargo is one of six U.S. banks – Citigroup, Goldman Sachs Group Inc. (GS), and Morgan Stanley (MS), Bank of America Corp. (BAC) and JPMorgan Chase & Co. (JPM) – with assets of more than $1 trillion. They are so large they form a separate “top tier” of banks, since the next largest bank, PNC Financial Services (PNC), has assets of only $295 billion.

However, Wells Fargo’s first-quarter success does not mean that all the top-tier banks will do well. Both Wells Fargo and Wachovia were heavily oriented to conventional retail and commercial banking, with massive branch networks all over the United States. The combined Wells Fargo was thus much less reliant on the slumbering investment banking business than other top-tier banks. It was also far less involved in high-risk capital-markets game playing, which got so many other banks in trouble. For example, while Wachovia got $500 million of dubious payouts from American International Group Inc.’s (AIG) dodgy credit default swaps, Wells got nothing, and therefore presumably had no net exposure.

Wells Fargo, in short, is becoming a model of what a nation should require of its behemoths under the “too big to fail” doctrine. It does mostly conventional retail and corporate banking, and provides economically useful services to its nationwide network of clients. It takes few huge risks, and is emerging from 2008’s disaster in pretty good shape. Without the Wachovia acquisition, Wells Fargo could probably have avoided the need for TARP capital.

In my February report on the top 12 U.S. banks, I showed how many of the top banks were in pretty good shape and offered investors good value, which would be demonstrated by higher first quarter earnings going forward. The Financial Select Sector SPDR fund (XLF) is up about 39% since then, so that was a pretty pleasing call.

Of course, what I didn’t get right was that the dogs are up even more in percentage terms than the solid citizens. Citigroup, the biggest bow-wow of them all, has more than doubled. Going forward, I would expect quality to assert itself. While some of the weaker banks should survive, they will be able to take much less advantage of currently juicy lending opportunities than their stronger brethren.

Sorting Out the Winners and Losers

Over the long term, the road forward is clear. Roubini’s suggestion to break up the largest banks – say those with assets of more than $500 billion – may be impracticable. It is also unnecessary. They should simply be tightly restricted, allowed to undertake only “vanilla” banking businesses, without a presence in investment banking, or in high-risk trading.

The market would then sort matters out. Some banks, like Wells Fargo, would probably prefer to remain gigantic, but simple and low-risk – earning a reasonable return, paying their top executives moderately, and having their stock serve as a fine investment for risk-average investors seeking dividend income. Bank of America and JPMorgan might wish to divest their investment banking businesses and move toward this model. The cultural clash between Merrill Lynch and the old Bank of America has been huge, suggesting that their merger has huge negative synergy and that the two institutions would be worth more separated.

The top six’s two investment banks, Goldman Sachs and Morgan Stanley, would have no interest in commercial banking, in which they have little history, so would have to downsize dramatically. One possibility is splitting them three ways – an advisory business, a medium-sized institution with a magnificent client base, and a more or less unregulated hedge fund that could be allowed to bankrupt itself in the shadows. They would not be permitted to retain their current huge positions in “principal trading,” an activity of little economic purpose beyond exploiting the firm’s insider information.

As for Citigroup, it seems likely that its troubles are too great and its culture too aggressive for any Wells Fargo-type solution to be possible. Over time, it should almost certainly be liquidated.

Below the top tier, the U.S. regional banks should mostly be in good shape, with a few exceptions that were based in particularly troubled regions or who had been excessively aggressive. In any case, they would not be “too big to fail” and would be allowed to engage modestly in investment banking if they thought it profitable.

Since they would be allowed higher leverage than the behemoths, they would be more profitable. And over time, the banking business might fragment further, which could only be good for competition.

As the world has seen over the past year, the arguments for creating financial services behemoths were spurious. They were too large to manage, and they survived only because their host country taxpayers gave them an implicit guarantee.

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It’s been a while since I have had time to update the Offshore Banking blog. Just before the G20 meeting I was busy at our Strategies for Success in the Recession conference in Ireland, which I am pleased to say went even better than expected. The Irish climate even treated us to some beautiful sunshine!

The other thing I’ve been busy on is talking (i) to clients – who are besieging me asking me about the impact of the publication of the OECD’s new tax haven blacklist; and (ii) bankers – I spent all last week flying around Europe talking in person to private banking contacts… because as you know, sometimes what they say person-to-person, off the record, is where the real information is. Here, then is my definitive statement on tax havens, OECD blacklists, bank secrecy et al.

First of all, don’t panic! You need to analyze the situation as it applies to you. There is no one-size-fits-all answer. Offshore secrecy and tax havens are not dead. Remember the French expression plus ca change? It means the more things change, the more things stay the same. This comes to mind here.

Secondly, do not simply start moving your money around willy-nilly. You need to be in control – your moves should be pro-active, not reactive. Remember that with each transaction, withdrawal or transfer you risk your privacy. So any radical changes need to be well thought out. You still have time, but if yhou believe your arrangements need reviewing then now is the time to do it. Nothing is going to change overnight, and nothing is going to be retroactive. But you don’t want to put off action and be rushing through changes six months from now either.

Offshore Banking Secrecy: Call me cynical…

My view (which I would say is seriously considered and researched – hence my flying tour of Europe last week) is that 99% of this is political scaremongering. Gordon Brown and Obama are trying to distract voters from the dire mess they and their predecessors created at home  by looking for a scapegoat – in this case tax havens. Nicolas Sarkozy has seen an opportunity to jump on the bandwagon and gain positive media exposure and publicity not just in his home market, but on the world stage, which in turn French voters love (their President playing an active international role.)

Call me cynical but I don’t think any of these three could really give a damn about tax havens. They want publicity and distractions from problems at home. Anonymous foreign bankers are a very easy target. It was the bankers in the USA and the UK who caused the recession we are now in, not the offshore bankers. But bankers generally are a hated race at the moment so they are an easy target for mass hype.

Secondary to this thirst for publicity, there is another benefit to governments. They are scaring people off tax havens, and encouraging people to repatriate offshore assets. If you have assets offshore in one of the countries where bank secrecy remains intact, they hope to scare you into action. Don’t fall for it!

What has actually happened so far…

What we have is a list of commitments to establish bilateral agreements. Not the actual agreements, please note. Belgium, for example, has previously had a fiscal information exchange agreement with the USA, but has committed to sign another 48 agreements with other countries. 48 international agreements will keep bureaucrats busy for some time. And Belgium is not really known as a banking or tax haven.

Also worth considering are the words of OECD President Angel Gurria, quoted in El Pais on 4th April: “There’s a big difference between words and actions.”

So in terms of these commitments, there’s potentially a big difference between what they say and what they will actually do. In order to figure out “what happens next” we need to drill down to the individual country level. Andorra, for example, will definitely sign information exchange agreements with France, Spain and Portugal. Liechtenstein has signed agreements with Germany and the UK, and is seeking an agreement with France. Expanding tax information exchange networks beyond these countries will take some considerable time.

What Happens Next in Tax Havens? An emerging pattern…

Do you see a pattern beginning to emerge here?  Each country will first begin exchanging information with those countries where most of its depositors come from. On this basis, for example, I predict that Panama’s promised first information exchange agreement (when they get around to it – manana) will be with the USA… then maybe Colombia or Venezuela.

There’s nothing new at all here. I wrote in my Practical Offshore Banking Guide that the first rule of being discreet in offshore banking terms is not to put your money in obvious places. If your fellow countrymen seek to hide their money somewhere that is the WRONG place.

What do Individual Banking Secrecy Countries want?

There’s also something else to consider: what individual countries really want. Countries, like people, have hopes and aspirations – very important to consider when trying to predict their next moves.

To people who know, as opposed to the popular press, for example – there are big differences between the three European principalities Andorra, Liechtenstein and Monaco. Liechtenstein is the only one with a really strong interest in protecting banking secrecy. I suspect the political current in Andorra and Monaco is more towards joining the European mainstream, for completely different reasons that have nothing to do with banking, that I could expand upon at length but won’t in this forum. We’ll save that for a future Q Wealth Event.

Does the Tax Evasion Problem Really Exist?

I really seriously doubt that bank secrecy laws are causing as much tax evasion as G20 leaders make out. Most countries with sophisticated financial services are not really interested in providing banking services to clearly unsophisticated individuals who simply want to hide money and rely on bank secrecy provisions. That is why they are increasingly happy to sign these letters of intent.

There are much more attractive markets for tax havens, that are going to cause them much fewer hassles – whether it be insurance, online brokerage, mutual or hedge funds, etc etc. These businesses are the ones that are really costing onshore governments money in lost revenue, and creating wealth and economic growth in offshore centres – but they will not be affected in the least by the G20 grandstanding. These businesses are 100% legal and are advised by the best lawyers money can buy.

• This is 2009, my friends, and maintaining an account in your own name where you keep untaxed income just isn’t the way to go. It hasn’t been for years. There are so many better solutions for those seeking to achieve financial privacy.

I have never advocated tax evasion. I advocate financial privacy and bank secrecy because I believe in the forgotten concept of “innocent until proven guilty.” The entire focus of my writings and advice to clients is:

1. Use international corporate structures to reduce taxes legally. A good set-up can be had for just a few thousand dollars that will draw a firm dividing line between your name and your assets, without you having to give up control. To this I would add that insurance wraps are looking like an increasingly good solution for achieving privacy. I’ll be writing more about the practicalities of this topic in The Q Wealth Report.
2. Move offshore yourself. Become non-resident. It is just so easy these days with wide availability of flights, working over the internet and so on. Besides tax benefits there are a lot of other benefits to moving offshore, like lower cost of living, higher quality of life, and better security. Your personal residence can be flexible. It is of the utmost importance in an overall tax plan.

Countries Not Blacklisted

The smart bankers I was talking to in Europe last week have seen the writing on the wall for years, and have been busy establishing banking subsidiaries in a wide range of other jurisdictions. The banks we recommend all have contingency plans in place.

Leaving aside the interesting topic of insurance wraps that I will save for a future article (that become worthwhile with larger amounts of money, let’s say seven figures) … there are simple, easy, watertight solutions available.

Right now, for example, I could set you up a Panama corporation, with nominee directors and bearer shares, with absolutely no information held in Panama about ownership or control, with a bank account with a European owned and regulated bank but the account domiciled in a non-European branch that is not on any OECD list and does not have any information exchange agreements with any country. Of course I won’t name it here, but you are welcome to contact me for a consultation on this matter. That way you have multiple layers of protection, and you can sit back and relax and watch all this political grandstanding from afar. The cost of this structure is just US$ 2995.

So don’t panic! Watch what happens, be on the lookout for alternatives, and feel free to contact me for a consultation. A note with all due respect: I am snowed under with people asking questions right now, and simply don’t have the time to give advice for free. Kindly review my page about Consulting Services and Fees before contacting me. Thank you. If you contact me for a consultation and pay the fee, the subsequently decide to purchase the above-mentioned service, I will refund the consultation fee to you. Also a reminder that if you would like a free copy of the Practical Offshore Banking Guide, a free copy of How to Buy and Hide Gold Bullion Offshore, and a free consultation with yours truly, all you need to do is sign up for a subscription to The Q Wealth Report quarterly newsletter for just $87 per year…

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As you approach Belize by air, the first thing you notice is the surf breaking over the spectacular barrier reef that runs parallel with the coast from north to south for roughly 250 kms. As you cross the reef approaching the airport at Belize City you see dozens of small cayes (islands), around 200 in total off Belize, most with white sandy beaches, fishing flats, and some with a few boutique-style hotels.

But the beatiful, pristine natural environment is just a bonus: we’re visiting Belize today because it still offers an excellent offshore business environment, unhindered by recent changes affecting tax havens in the rest of the world.

Belize (formerly known as British Honduras) is an English speaking offshore haven – a real alternative to Panama in the Central American offshore investment environment. Belize offers three things of immediate interest to our readers:

• Belize IBCs (International Business Corporations). For under $1000 you can form a simple corporation in Belize. Your IBC can do business anywhere in the world you choose – except Belize! Typical uses include e-commerce, personal holding companies, and special purpose vehicles. Belize IBCs are not subject to any kind of information exchange agreements. Even the mere ownership of a Belize IBC is a state secret – the Registrar of Companies must know, but they are strictly prohibited from revealing this information. Belize is home to many reputable law firms and resident agents, including many names well known in Panama. My firm is able to incorporate in Belize. The registry is fully online and works great – incorporation orders can be handled the same day.
• Offshore Banking in Belize: Belize is a well regulated and managed offshore banking haven (also known as an International Financial Centre). And banking is not restricted to the capital Belize City – you will also find offshore banks represented in the beautiful tourist areas like San Pedro Town, Ambergris Caye. You haven’t heard about any bank failures or bailouts in Belize, because there haven’t been any. The international banking sector in Belize (separated from the resident banking sector) is stable, and is forbidden from engaging in risky business practices. Trust me – go there, talk to the banks, and get a feel for it. They are laid back, Caribbean style, but they know very well what they are doing, and those discreet computer terminals move millions every day. If you would like recommendations for specific offshore banks to talk to in Belize, contact me via The Q Wealth offices in London.
• The QRP or Belize Qualified Retired Persons program. This is a well established system for new residents over the age of 45 (and their families, who may be younger) who can prove at least US$2000 monthly income from outside Belize. They can apply to receive the right (but not the obligation) to live in Belize… and all their foreign income anywhere in the world, or through a Belizean IBC, will be tax exempt – completely – for ever! Sounds like a good deal? That’s because it is. I’ll be writing more about the QRP here over the next month or two, because it truly is an excellent opportunity. But it looks like the doors may be closing later this year… Oh and one other thing, after five years of residence, you qualify for a Belize passport. For $250. There are a few details that need handling, but nothing that yours truly can’t handle in a day’s work!

This is the first in a series of articles about the offshore sector and doing business in Belize. I’ll be adding more as and when time permits. If you have questions in the meantime, or would like to go ahead and set up a Belize IBC or open a Belize bank account, please don’t hesitate to drop me an e-mail.

By the way, did I mention the fishing in Belize? A trip to visit your offshore bank can be combined with fishing that is perhaps the best and most inexpensive in the region.  Inside the reef and on the atolls there are flats offering wonderful fly-fishing for Bonefish, Tarpon, Snook, excellent Baracuda and especially good is the Permit fishing. Outside the barrier reef is some exceptional deep sea and bait fishing, and three atolls offering yet more spectacular salt-water fly fishing opportunities.

If fishing is not your scene, Belize also offers a wonderful variety of scenery to suit most people, and allowing you to have a simple beach holiday or head to the inland jungle, where you can trek and visiting 2000 year old Mayan ruins. The choice of how much you do or don’t do is entirely up to you. The style and quality of the hotels and lodges in Belize varies enormously and can be chosen to suit most peoples budget and requirements.

From somewhere offshore, this is your offshore banking expert Peter Macfarlane. Till next time!

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The Vatican is expected to demand the end of offshore banking in its official statement, the encyclical, which is due to be released during the coming week. According to Offshore Net, the Vatican blames offshore banking for the financial crisis and also points the blame for offshore banking’s involvement in transferring wealth from poverty stricken parts of the world to richer countries. According to the Vatican, if taxed at source these funds could be much better utilized in helping the citizens of these underdeveloped countries. I really don’t agree with them…

Today being Sunday, I thought it might be an interesting time to talk about the Vatican Bank, or The Institute for Religious Works (in Italian: Istituto per le Opere di Religione – IOR) as it is more correctly known. The Vatican Bank is located inside the Vatican City. That’s one very rich country, with no taxation, that receives quite a lot of money from poor, undeveloped countries.

The Vatican Bank is a professionally run international bank, even having its own SWIFT code IOPRVAVX, which is more than can be said for many of the offshore banks out there! It maintains correspondent accounts for moving money at all major US and European banks. It offers what amount to a range of trust and asset protection services, and of course it deals in gold bullion.

Once I wrote to them and asked if I, as a non-resident of the Vatican, could open an account, but  sadly I never received a reply. Perhaps, therefore, their service is not up to Liechtenstein’s Private Banking service level.

The Vatican Bank operates exactly like a small, privacy-oriented offshore bank – moving millions for organizations worldwide that are not, to put it mildly, bastions of transparency. It is said to have at least $10 billion in assets under control, for depositors around the world – Foundations and the like. (I wonder if they have any Panama Foundations as account holders?) It was involved in a major political and financial scandal in the 1980s, concerning the collapse of Italian bank Banco Ambrosiano, of which it was a major share-holder at the time.

The Vatican, in my mind therefore, deserves its place as a small European state with an impressive wealth management (basically offshore banking) industry, alongside the players I more frequently write about such as Andorra, Liechtenstein, and Luxembourg. These three little states have a lot to offer in terms of offshore banking.

Two more European mini-states I write about less frequently are Monaco and San Marino. Both of these also have their niche private banking businesses, but it is harder to open accounts and they usually require substantial minimum deposits.

N.B.: More information including specific, step-by-step advice and detailed contact information  on how you can open your own offshore bank accounts in all these European tax havens (with the possible exception of the Vatican!) may be found in the Practical Offshore Banking Guide 2009 available FREE for download in the Members’ Section at Q Wealth Report.

Sphere: Related Content

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Gnomes on the ground in Zurich and Geneva are expressing shock and dismay about what is going on in the world of Swiss banking. Meantime, I’ve had several e-mails and calls in from people asking for quick solutions because UBS is closing their accounts and they don’t know what to do with their money!

The first thing to do is remain cool, calm and collected. Things are probably not as bad as they seem. Don’t do anything hasty, because decisions made under pressure may not be the best. It is possibly to calmly move your account over to other European private banks, and my firm is already helping a few people with that.

“We are committed to moving forward with the summons enforcement process. This action sends a strong signal to taxpayers hiding their money offshore. The IRS will be aggressive in pursuing people who shirk their obligations under the tax law. These people owe it to their fellow citizens to pay their fair share of taxes,” said IRS Commissioner Doug Shulman, in a Department of Justice Press Release. That is exactly what is going on here. Releases to the media intended to send strong signals to get Americans running scared.

The same press release also quotes John A. DiCicco, Acting Assistant Attorney General for the Justice Department’s Tax Division. as saying: “At a time when millions of Americans are losing their jobs, their homes and their health care, it is appalling that more than 50,000 of the wealthiest among us have actively sought to evade their civic and legal duty to pay taxes.” Hmmm… sorry but that doesn’t quite add up. Funny isn’t it how they don’t draw the attention to the billions of dollars being wasted in Iraq, for example. That might be less of an incentive to pay taxes. Neither do they mention that the strategy for bailing out the American economy involves pumping still more billions of dollars into the pockets of bankers and insurance executives. Anyway, time to get down again from my soapbox and start talking practical solutions.

As I said in my article Is Offshore or Swiss Banking Dead?, “The why and the how of offshore banking for security and asset protection is alive and well. In fact, for American and European Union citizens, banking offshore is more important than ever.” In that linked article I went on to explain my reasoning, in case you are interested…

Anyway, here are the practical solutions for UBS and other affected account holders at Swiss banks, that bear repearing (because although we are hearing a lot about UBS, no doubt other Swiss banks are panicking about their American account holders too) I mentioned above that affected account holders should be taking “urgent steps to put things right.” What are those steps?

The fact is there are plenty of ways you can achieve the goals you are seeking, serious asset protection, and full compliance with all applicable laws and regulations still without handing your hard earned dollars over to the government for them to pour down the drain in bailouts and wars. Those are topics we frequently write about in The Q Wealth Report, and you will find some starting points in my Practical Offshore Banking Guide 2009 which is available right now for free download in the Members’ Section. The Practical Offshore Banking Guide includes some offshore banking notes especially for US citizens and residents, and another section especially for European Union residents and citizens.

Q Wealth Report is your resource for offshore asset protection, banking privacy, and wealth creation information. A subscription costs just $87 per year, and if you don’t feel  our service is worth a lot more than that once you have signed up, you are covered by our full no-quibble money back guarantee! Plus, as soon as you sign up you gain instant access to our members section to download a series of free reports including the Practical Offshore Banking Guide 2009 and of course The Gold Report.Thinking of which, the best advice for affected UBS and other Swiss Bank Account holders might just be to ask UBS to deliver them physical gold bullion which can then be shipped out of Switzerland. A good destination might still be Vienna, Austria, where it is possible still to open an anonymous safe deposit facility completely legally, just like in the old days… all details are in The Gold Report, which is also known as How to Buy and Hide Gold Bullion Offshore

P.S. No of course I’m not going to put the juicy how-to information here on a free blog for all to see. If you want the real facts on offshore banking and asset protection, check the links above.

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