Do you want to open an account abroad because you are going on a long trip, a study trip or simply to diversify your investments? You may think that it is an arduous and complicated process and this may put you off, but don’t worry: in this post we give you all the key elements.
Is it legal to open an account abroad?
Logically, this is the first question you ask yourself when you think about doing this procedure: will I have to face legal consequences for opening a bank account abroad? Is it allowed?
You can rest assured: opening an account abroad is totally legal and more common than you might think. You just have to pay attention to comply with the current regulations regarding the payment of taxes on the income it may generate, but don’t worry, we will tell you more about it later.
How to open an online account abroad
If you are going to open an account in a country belonging to the European Union, you will be able to do the whole procedure online, without going physically to the country in question, in a multitude of recognized banking institutions.
The specific requirements depend largely on the entity with which you want to open the account: usually, traditional banks do not allow opening online accounts and request a lot of documentation and, in most cases, the physical presence of the interested party, even if he/she resides in another country.
On the other hand, many more traditional banks do not allow you to open an account online.
Accounts with foreign IBAN
The International Bank Account Number or IBAN is the alphanumeric code that identifies a bank account within the Euro zone. The four initial characters, two letters and two numbers, are the country code (in the case of Belgium, for example, BE) and the control code (in Belgian bank accounts, 21).
Opening an account with a foreign IBAN is the fastest way to withdraw money from Belgium, since our savings will be in the country to which the IBAN code of the account refers and will be protected by the Deposit Guarantee Fund or equivalent body of the country in question.
Some of the most recommendable European accounts with foreign IBAN are:
- Moneytrans Smile account: account with Belgian IBAN that allows you to operate normally both in your country of origin and in Spain and France, making it one of the best options.
- Banca Progetto: Italian IBAN and FGD.
- Bunq: although the entity is based in the Netherlands and the FGD is Dutch, it is possible to open an account with Dutch, German, Spanish, Irish and French IBAN.
- Easisave: Both IBAN and FGD are Maltese.
- Lea Bank: Norwegian IBAN and FGD.
- Nationale Nederlanden: Dutch IBAN and FGD.
- Revolut: Lithuanian IBAN and FGD.
- Wise: the account will have a Belgian IBAN but, beware, it will not be protected by any FGD.
Accounts with European IBAN
If you do not want to have more than one account, you can choose a foreign bank that operates in Belgium; this way you will have an account number with a European IBAN, which will allow you to operate normally in our country, but your money will be protected by the German or Dutch Deposit Guarantee Funds.
- N26: this is a German bank, with a European IBAN and is adhered to the German DGF.
- Vivid: it is also a German entity, associated to Solarisbank AG and under the protection of the German DGF.
- ING: although the IBAN of the account will be European, the money in the account will be protected by the Dutch FGD, since the entity comes from Holland.
Advantages of opening an account in another European country
Beyond the cases in which the account is opened for work, student needs or for having a second residence in the country in question, having a second bank account in a foreign country entails a series of very interesting advantages:
- Diversification of savings and investment products.
- Reduction of country risk, especially in cases of political or economic instability.
- Higher profitability, since foreign accounts usually improve the figures of Spanish accounts.
- Protection, since they are products adhered to the Deposit Guarantee Funds of the country in question.
- Ease of use, as these products are mostly managed online.
In addition, they are usually multi-currency products, which will allow you to save on commissions when paying by card or withdrawing money from ATMs.
What should I look out for before opening an online account abroad?
Opening an account in any country belonging to the European Union is essentially a simple and safe procedure, but it is worth paying attention to certain aspects before and during the process:
- Find out about the financial institution, its history, its rating, the opinions of its customers and whether or not it is adhered to the FGD of its country of origin… After all, you are going to give them your money.
- Investigate the conditions of the account before you open it: many products are designed for savings and not to operate with them on a regular basis, so they may not allow partial withdrawals or periodic deposits of money.
Is it safe to open an online account abroad?
Absolutely. Opening a bank account in any country of the European Union is as safe as doing it in Belgium, as long as you make sure that the bank is a prestigious entity and complies with the legislation in force in your country of origin.
How much money can be held in a foreign account?
There is no express limit of money, but you must take into account that if the account has a balance of more than 50,000 euros you must inform the Tax Agency. If the money you have abroad, regardless of the number of financial products contracted, does not exceed this amount, you will not have to take any additional steps.
How to declare your money abroad
As we said, it is only compulsory to declare to the Treasury the money you have abroad if it exceeds 50,000 euros, regardless of the number of savings and investment products contracted: that is, if you have 3 different accounts but the sum of the balances of all of them does not reach 50,000 euros, it is not necessary to do anything.
On the other hand, if you have only one bank account abroad, but the amount of the same equals or exceeds that amount, you will have to file form 720, an informative declaration that does not necessarily imply that you have to pay taxes, and which is filed at the end of the year.
How often is the Form 720 filed
Once you have filed the model 720 for the first time, you do not need to file it again every year if your wealth abroad has not changed: you will only need to fill it in again to inform the Treasury if the balance of your accounts or investments outside Spain has increased by 20,000 euros or more.
Discover the Smile account
If everything we have told you is complicated, there is a much simpler way to get an account with a foreign IBAN without any complications. With the Moneytrans Smile account, it’s all advantages:
- You will immediately have a bank account with a Belgian IBAN (BE).
- This is not a savings product, but a fully operational account, where you can receive your salary and have your bills paid by direct debit.
- The account is associated with a Mastercard with which you can pay in stores and withdraw money from ATMs all over the world.
- You will be able to carry out all the procedures online or go to one of the hundreds of Smile points available throughout Europe.
- You will be able to send and receive money from any country in the world at a really low cost.
- No hidden costs or commissions: transparency is our goal.