I’m all for finding creative yet legal avenues to optimize your taxes, enabling you to benefit from lower taxes without facing legal consequences. However, engaging in deceitful or incomplete tax avoidance carries severe repercussions and is ill-advised. Please heed this advice from someone who has walked this path before you. The mental strain, the financial burdens—exorbitant legal fees, hefty fines, the inability to work during investigations, the potential for imprisonment (depending on your country of residence and the extent of evasion), and the lasting stain on your criminal record—it’s simply not worth the risk in the long run.
If you still insist on walking this path, there are two possible outcomes.
If you don’t get caught (yet)
Congratulations, you’ve dodged a bullet that many others haven’t. However, not getting busted now doesn’t guarantee immunity in the future. Tax evasion comes with its own set of costs:
Discreet Transactions: You always have to watch your back and conceal your trail to avoid leaving any trace behind. You must exercise strong discipline and careful oversight to avoid any direct ties between you and your money, always employing intermediaries to prevent easy detection and increase complexity.
Thorough Financial Planning: Every significant financial decision must be carefully considered and thoroughly planned in advance. Take, for example, purchasing property. Think twice if you believe it’s straightforward. The first question you need to ask yourself—Who will make the purchase—you, your offshore company, or through an intermediary? Each option presents its own set of challenges.
- If purchasing under your name, how will you discreetly and legally transfer the money to yourself?
- If using an offshore company, anticipate potential scrutiny from local banks for possible money laundering. I had firsthand experience twice, and it was far from stress-free. The first instance occurred when I attempted to buy an apartment in Tbilisi, Georgia; the local bank flagged the transaction, requested details about my offshore company, and ultimately rejected the transaction, terminating my existing account and banning both me and my company for three years without explanation. The second incident involved paying a construction team in Georgia through my ten-year-old Dutch bank account. I underwent an ING KYC investigation for over two months on suspicion of money laundering, which nearly led to the termination of my business account. Fortunately, I was cleared, but the unnecessary stress and wasted time made it a terrible ordeal.
- If using an intermediary, expect added costs, headaches, and complexity.
Risks of Losing Your Assets: If something were to happen to you, how would your family claim your assets, considering both your identity and your company’s identity have been completely obscured in your offshore jurisdiction? Even if they have access, navigating these complexities is no easy task.
Cost of Secrecy: Maintaining secrecy comes at a premium. Offshore services, agencies, and banks all charge hefty fees for their discretion and services.
Limited Financial Freedom: Your freedom to use your money is more restricted than you realize. Despite having financial resources, purchasing anything you want, where, how, and when you want it without careful consideration is not feasible.
If you get caught
Even the mere thought of this scenario shatters my heart. Having experienced it firsthand, I can attest to the long, dark, and hopeless journey it entails—an experience I wouldn’t wish upon anyone. If you do find yourself in this situation, reading my book can offer a glimpse into what awaits, helping you mentally prepare to some extent. Additionally, if needed, you can schedule a call with me, where I can offer support and guidance throughout your journey.
Below are three unavoidable consequences that you must face, regardless of the circumstances:
Emotional Rollercoaster: Brace yourself for a mental upheaval unlike any other. The turmoil you’ll endure will make any past traumas pale in comparison.
Financial Drain: Your hidden funds will evaporate into thin air, drained by exorbitant legal fees and hefty fines. What remains may barely sustain you, or worse, plunge you into debt depending on your final verdict.
Legal Fallout: Prepare for the possibility of a tarnished record and time served behind bars. The consequences of your actions will leave a lasting mark on your life.
Remember, money always finds a way to leave its mark. No matter how carefully you conceal it, even the slightest trace can lead to its discovery, unveiling every step of its journey.
** This chapter is part of a SIX-chapter series— don’t miss any part of the story! Stay updated and read more chapters from this series here:
- Introduction: Offshore Companies & Tax Evasion (6 Chapters)
- Part 1: What Is an Offshore Company? What Is Tax Evasion?
- Part 2: List Of Known Offshore Countries And Territories
- Part 3: Should You Open An Offshore Company?
- Part 4: What Is The Best Offshore Structure?
- Part 5: Where Should You Best Have Your Offshore Incorporated?
- Part 6 (Final): Words Of Caution