Opening an International Bank Account for Jet Owners15 min read

Opening an International Bank Account for Jet Owners15 min read

Opening an international bank account is frequently used in international payments, and can also be used in jet purchases, sales and payments. Having your own private jet is one of life’s many pleasures, but it also presents its own unique financial dilemmas. If you own a jet, you must experience foreign payments, multi-currency payments, and cross-border banking needs all the time. 

If you have the right banking partner, these things will become much simpler. In this article, we’ll discuss why jet owners need global banking, how you can get one, and what you’ll get out of partnering with a good bank such as The Kingdom Bank.

Why Should Jet Owners Consider Opening an International Bank Account?

Private jet owners might want to open an international bank account for various reasons. Here are some of the best advantages:

Convenience of global banking access. If you own a jet, you probably deal with international clients all the time. The bank account that will allow you access to banking services around the world makes payments, transfers, and cross-border payments extremely easy. A global bank account lets you easily bank whenever you’re on the move.

Ease of multi-currency management. It’s natural to trade multiple currencies when you have something as trans-national mobile as a private jet. A multi-currency international account makes it easier to track money in multiple currencies. You can transfer funds between currencies and send invoices in the desired tender with just a few mouse clicks. No more high-cost wire transfers or low-rate exchange rates.

Tax efficiencies. Some offshore banking jurisdictions have tax concessions that allow jet owners to save on taxes. For instance, if you open an international bank account in a country that doesn’t tax your income or capital gains, you can keep more of the money from your jet or charter business. It might be worth it, in the sense that the tax savings can help offset the private jet ownership expense.

Bulk purchasing power. Jet owners have huge negotiating power because they’re the world’s largest purchaser of goods and services. A global bank that recognizes your particular requirements might have global relationships and buying power that enable them to negotiate lower rates for everything from gas to car maintenance to insurance.

The sheer volume of private jet business globally makes international banking almost indispensable for simplicity, cost-effectiveness and compliance. So let’s see how we create such an account.

Step-by-Step Process for Opening an International Bank Account as a Jet Owner

A global bank account is the same as a domestic one but requires some verifications due to international laws. 

Here are the typical steps:

• Choose a reputable international bank. Consider looking into banks that cater to high-net-worth clients, such as The Kingdom Bank, and choose one that’s based in your desired banking region.
• Complete the application. Enter standard KYC (“Know Your Customer”) data such as name, address, date of birth, and source of wealth. You’ll need supporting documents such as your passport.
• Verify your identity. The bank will ask for further evidence to prove your identity, such as utility bills, or tax records, or referrals from other lenders you use. They may even conduct electronic ID verification.
• Undergo due diligence. It is imperative for the bank to have knowledge of what your banking history is likely to be, and to keep track of transactions to ensure that it meets all applicable anti-money laundering regulations around the world. Expect long-winded conversations about how your account is supposed to be used.
• Fund the initial deposit. It’s standard practice for banks around the world to require a first deposit as low as several thousand dollars to establish an account. You can move money from an existing bank.
• Set up account access. Choose your method of access – online banking, wire transfer, debit/credit cards, etc. The bank will help you with the account setup.
• Start using your account! Once verified, you’ll get login information and can start banking internationally with your new account.

Depending on the bank partner and complexity of their verification process, this may take between 4-8 weeks. If you’re organised and prepared, it’s possible to open an international bank account as a jet owner.

Tax Benefits of Having an International Bank Account as a Jet Owner

One of the most effective motivations for jet owners to open an offshore bank account is tax benefits. 

A few of The Kingdom Bank’s clients’ strategies are as follows:

• Tax-free earnings in some jurisdictions. As noted above, some offshore financial centers do not charge income or capital gains tax on any income held in offshore bank accounts. Cash earned from chartering out of the country would be tax-free.
• Potential reduction of U.S. taxes. For US owners of American jets, the Foreign Earned Income Exclusion lets you deduct as much as $112,000 in overseas income from your US taxes (as long as it’s earned outside the US). You might get income from an offshore account.
• Tax deferral on asset sales. If one day you sell your jet and keep the proceeds in an offshore bank account, you can pay capital gains tax in your country of residence until you have the money.
• Tax treaties prevent double taxation. Some states only mandate a single income tax through interstate contracts. The Kingdom Bank knows which ones are for you.

Taxation rules, of course, are complicated and you should seek the advice of professional international tax advisers. 

But if you have the correct offshore banking system in place, you could significantly minimise your jet owner’s tax burden.

How to Handle Multi-Currency Transactions for Your Jet Through an International Bank Account

Because aircraft maintenance, fuel, charter fees and other operations expenses are often invoiced in many different currency amounts, strong multi-currency account support is a requirement for your bank partner.

A cutting-edge foreign bank such as The Kingdom Bank automates cross-currency payments, collection and exchanges through integrated currency exchange solutions. 

Below is a breakdown of how multi-currency exchanges can be successfully implemented:

• Accept payments in various currencies. Create your bank account so that you can receive wire transfers, debit/credit card and any other deposits in USD, EUR, GBP or other currencies without paying a fee for clients who send charter invoices.
• Pay invoices in required currency. Your bank’s online interface should make it simple to pay maintenance stations, fuel sellers or other suppliers in the world from your bank account in local currency in just a few clicks. No need for multiple accounts.
• Set exchange rates. Trade at favorable exchange rates with your bank to ensure your money is being converted from valuta pairs to the highest values. Some banks even allow rate locking for large future conversions.
• Consolidate balances. Display a single line showing balances in your reporting currency of choice, such as USD. You don’t have to fumble between statements or manually pull figures together.
• Transfer funds seamlessly. Transmit funds in more than one currency between accounts online or via your banking app, without having to visit a branch.

When you have the right global banking partner, cross-border exchanges are easy, not challenging, as a global jet owner. A single app automates multi-currency transactions.

What Documents You Need to Open an International Bank Account as a Jet Owner

At most good international banks, jet owners must be willing to submit the following essential documents to complete the application process:

• Passport – As identity and residence/nationality document. May need extra pages if you do a lot of traveling overseas.
• Address proof – An existing utility bill or bank statement for at least 3 months with your name and street address on it.
• Corporate accounts – Certificates of incorporation or other evidence that your company is registered.
• Wealth source documents – To show how you earned your wealth (tax returns, asset/company sale contracts, inheritance documents, etc.).
• Bank reference letter – Contact number of your home bank so that the foreign bank knows who you are and what you are doing.
• Due diligence questionnaire – Be prepared to fill out an elaborate form that outlines what you plan to bank with, your ownership structure if applicable, transaction volume, etc.
• Minimum initial deposit – Banks generally need proof of an initial deposit of at least $2,000-10,000 worth.

Having the full documents can speed up the verification process. Keep documents organized on a digital shelf so that you can share as needed. 

With the right documentation, jet-owners could seamlessly open an international bank account that met their international financial requirements. 

With the right offshore bank like The Kingdom Bank, directing your multi-national wealth is not a job, but a pleasure.