Why "Offshore"?

What if there were a country that would allow you to establish Trusts, Foundations, and Corporations without asking you to report to anybody what funds you have sitting there? Wouldn't such a privacy indeed make taxation and garnishment of your assets impossible?

Such countries do exist! There are at least 50 of them. (You might be surprised to know that the USA is one of them... ) All they ask in return for you letting their accountants and lawyers manage your assets is that you do not reside in their country! This way, these countries can generate work for their own people by hoarding the wealth of people from other countries. Very much like "Swiss banks" - just, in some significant cases, much, much smarter - for you to benefit from!

For Trusts, we are looking for countries that base their legal system on "Common Law principle" - which basically is acknowledging tradition and common sense principles as laws that bind people to act in certain ways, just as specific legislation does. This legal tradition originates in medieval England and is now used as a major law principle in almost all countries that once were under British rule, including the USA, Canada, Belize, Bahamas, Grenada, Dominican Republic, British Virgin Islands - just to mention a few North American examples.

For Foundations, we have to look for countries that base their legal system on the "Civic Law principle", which basically is the French law basis developed during the French revolution. The main countries of International interest are Switzerland, Luxembourg, Liechtenstein, and Panama.

For corporations, most countries are providing the legal frame for those, whether Civic Law or Common Law. But the price range is huge: from just $150 in many US states to over $30,000 in Denmark!

(You can refresh your geography memory by opening a map over the Caribbean in a separate window)

Some of these countries, particularly Belize, Bahamas, Turks and Caicos Island, British Virgin Islands, Nevis and St. Kitt, Dominica, and Grenada have added very powerful legislation to confirm the old principles of Trusts in order to attract foreign investment and generate work for their bankers and accountants and lawyers, much like the Swiss banks.

The law in Belize, for instance, even states that for foreign beneficiaries of Belize Trusts, not even the Belize government can access information in the Trust, and it most certainly cannot tax it on any income or assets it does not even know about or want to know about! Grenada did the same - and even added approval of Foreign Grantor Trusts when proposed as a specific means of avoiding legal conflicts for US citizens.

Your government will not like this - yet there is no risk that even the USA's government will invade Belize or Grenada and get the information through military force. A very good reason is that all the rich and influential people in the USA and Canada, including most of the politicians, have their own private Trusts in those offshore countries, and they don't want to pay taxes on their assets either!

(And, just for the true pessimists: even if military action was threatening, the Protector of the trust can and will very quickly remove the information about the trust's assets away from the country that is threatened. Because no other records are kept anywhere - except in your personal files where you of course will have relevant copies in your safe - you are ensured the most effective confidentiality that can possibly be given on the planet!)

The same goes for Panama Foundations; in Panama, it is a criminal offense, penalized with minimum 3 years in jail, for any officer of a Foundation to reveal any confidential information about the Foundation, its Beneficiaries, or its Protector.

The safety of establishing an offshore presence is like taking hostage all the political decision-makers and their personal wealth. It is pretty obvious that they are not going to give up their own privileges just to destroy your wealth - after all, they have much more to lose than you!

It is much simpler for the wealthy people to keep you believing that creating an offshore presence is far too complicated and expensive for you to do, so you will continue paying those taxes they avoid....

Remember how the Swiss banks were able to keep their confidentiality through the wars...

So, the real power of going offshore when establishing your Trust or Foundation comes from the following facts:
  • You choose a country that has a strong legal tradition for respecting their own law, possibly even confirming these principles in its constitution (as Belize, Panama, Dominica, and Grenada, for instance, do).

  • You choose a country that will tax neither you nor your Trust/Foundation on any income to the entity, any payments from it, or any other transactions carried out by it - as long as its creator, management, and beneficiaries do not reside in the country.

  • You choose a country that insists on its own sovereignty, so that it will not report to any foreign government what is going on in terms of money transaction within its sovereign jurisdiction, preferably one that even puts itself into a position where it cannot do so, simply because it does not even have access to that information itself!

Is it starting to make sense? If so, please continue with:
Using Your Offshore Trust