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Tips - March 23, 2022

5 Countries Where Billionaires Hide Their Wealth

According to data, offshore accounts and other methods are used by politicians, billionaires, and celebrities to hide trillions of dollars and assets.

In 2021, a stack of 2.5 million data was discovered by the International Consortium of Investigative Journalists (ICIJ), connecting offshore accounts to wealthy individuals and governments globally.

The data revealed some countries where renowned billionaires in various sectors hide their wealth.

According to the report, offshore accounts and other methods are used by politicians, billionaires, and celebrities to hide trillions of dollars and assets.

However, some of these transactions lawfully used well-connected tax accountants, attorneys, and offshore tax-havens.

The companies range from shell companies, trusts, foundations set up in countries with little or no taxes and permissive rules to make inquiries about money flow.

Here are the top five countries where billionaires hide their wealth.

Switzerland

The banking industry in Switzerland is the most stable in the world. This is why it is the finest tax haven, secrecy jurisdiction, and financial centre globally.

In 2015, the Swiss Bankers Association said the banks in the country manage assets worth 6.65 trillion CHF. 

However, owing to demand from the United States and the European Union (EU), information about Swiss bank accounts might be made available to tax authorities.

The accounts worth over $50,000 will be given to applicable tax authorities in 60 countries.

Hong Kong

Hong Kong has its autonomy as China’s first special administrative. Since China still safeguards it, it maintains its stability to attract funds from outside investors.

Hong Kong has a stellar track record as one of the fastest-growing tax havens. As of 2015, the country has the most significant number of Ultra High Net Worth individuals globally.

It has an individual wealth exceeding $100 million per capita, a fund management business worth $2.1 trillion and over $350 billion in private banking assets.

The tax policy of the country is based on territories. Incomes made by firms doing businesses in the country are taxed a fixed 17.5%.

The country’s tax laws are divided into territories. Companies doing business in Hong Kong are subject to 17.5% taxation. 

Income earned from doing business outside of Hong Kong, on the other hand, is tax-free. Also, corporations’ interests, capital gains, and dividends are exempted from tax.

United States of America

Despite its opposition to international tax havens, the country has evolved into a major tax haven.

Since the country provides a stable and controlled environment for refuge seekers, they transfer their assets from other tax havens to the US. As a result, it is the most tolerant and secure location for global riches and fortune compared with other tax haven countries.

Due to this, thousands of claimed ghost corporations exist in Delaware, Nevada, Arizona, Montana, New York, and Wyoming. 

Although these firms are used for illegal businesses, the country sees nothing wrong with it since they might be utilised for lawful activities.

Singapore

Singapore and Hong Kong are competing for Asia’s leading offshore financial centre. Even though Singapore caters mainly to Southeast Asian investors, many from North Asia and China keep their money in the country instead of Hong Kong.

This is because registered firms doing business outside of Singapore are excluded from paying annual income tax. However, companies doing business in Singapore must pay a 17% tax rate if their yearly revenue exceeds $2 million.

But if the company fulfils the Inland Revenue Authority of Singapore (IRAS) conditions, the tax rate can be reduced or cancelled.

Information on offshore account holders and offshore bank accounts are illegal to disclose by bank officers. Furthermore, disclosing the information is punishable by imprisonment or penalties.

Cayman Islands

The Cayman Islands are considered a member of the Caribbean tax havens. It is one of the most well-known tax havens since it has no company tax. 

Also, any Cayman Islands-based company can keep its assets without paying any tax and asset owners’ privacy is considered primary.

According to Tax Justice Network, the Islands is currently the world’s sixth-largest financial centre. As of the late second quarter of 2014, it has $1.4 trillion in banking assets.

Furthermore, the country has a net asset of $2.1 trillion. The majority of it is from Europe and the United States.

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