Offshore investing has often been portrayed in the media as a dubious and quasi-illegal practice. However, the reality of offshore investing is that it’s actually a very wise financial move for those who have the wherewithal to utilise it in the proper way. And whilst there will always be those unscrupulous people who seek to undermine the system by using offshore investing for unethical purposes, the majority of investors do so in strict accordance with the law.

A Short Guide to Offshore Investing

Put simply, offshore investing is any type of investment which takes place in a country exterior to the one in which the investor has a permanent residence. Therefore, offshore investing is actually a broad field, encompassing stocks, bonds, shares, property, currency and corporate – to name just a few examples.

The Benefits of Offshore Investing

The main reason why people choose to participate in offshore investing is because of the significant tax reductions which become available. Many countries will offer tax incentives to foreigners in order to persuade them into investing, because this helps to strengthen the resources of the country in question.

Offshore investing can also confer a degree of confidentiality that may not be available in the investor’s home country. Confidentiality of this sort, which is supported by law, is often extended to both corporations and individuals, with strict penalties for the divulgence of information covered by these laws. This can be of enormous benefit to some companies which, although they have nothing to hide, may wish to prevent their financial dealings from being observed and emulated by competitors.

The Cons of Offshore Trading

Whilst offshore investing has always been seen as being extremely tax efficient, the reality is that tax laws around the world are actually becoming less flexible. In addition, offshore accounts can be expensive to set up and are not always as safe as other types of investments.

To avoid running afoul of the pitfalls of offshore investing, it’s always recommended that you seek out the services of a professional personal investment advisor. Companies such as Sanlam. who have a wealth of experience and knowledge of the offshore investment field, can help you to select wise investments and build a strong portfolio.

The Pros and Cons of Offshore Investing