Tax havens are countries or territories where personal and business taxes are likely to be very low, or even non-existent.

As a result, these places often attract individuals and companies who are seeking to pay less tax than they would at home.

Businesses may move their headquarters to a tax haven, or individuals choose to live there for some or all of the year, as a means of qualifying for the lower tax regime.

Some countries or jurisdictions construct tax legislation with the explicit purpose of becoming tax havens.

“Havens are places where you can put your wealth in order to escape the rules at home. Those rules might be around tax, or criminal laws, or rules about transparency and disclosure, or financial regulations,” writes Nicholas Shaxson, author of Treasure Islands: Tax Havens And The Men Who Stole The World, in The Guardian .

Tax havens are everywhere. It’s like The Matrix. “I can’t stress strongly enough how everywhereish they are. And, until recently, who even noticed?” Shaxson writes.

You are part of the bear traps of tax havens if you have ever used Google or Amazon or registered for iTunes, he explains through examples, adding the names of a host of other companies from a “list of 350 multinationals whose convoluted tax schemes were revealed last November by a whistleblower, working for one accounting firm, PricewaterhouseCoopers (PwC), in one European tax haven, Luxembourg”.

Shaxson notes that “everything these companies are doing is legal: it’s what we call tax avoidance or planning—not evasion”.

You don’t have to put your wealth itself in the tax haven. It is the legal structure that owns the wealth—the shell company or the trust—that usually matters, he adds.

The vast Panama Papers leak gives a rare glimpse into how some of the wealthiest people in the world use offshore financial bolt holes to conceal billions of dollars in assets, reports AFP.

At the heart of any strategy is the shell company, created to give the appearance of being a legitimate business when its only purpose is in fact to stash away assets while keeping the real owner’s identity hidden. Adding a further cloak of anonymity, many schemes rely on trusts, the report added.

Interestingly, after years of lambasting other countries for helping rich Americans hide their money offshore, the US is emerging as a leading tax and secrecy haven for rich foreigners, reported Bloomberg . By resisting new global disclosure standards, the US is creating a hot new market, becoming the go-to place to stash foreign wealth. Everyone from London lawyers to Swiss trust companies is getting in on the act, helping the world’s rich move accounts from places like the Bahamas and the British Virgin Islands to Nevada, Wyoming, and South Dakota. See the top tax havens of the world here.

There are about 60 or so offshore jurisdictions around the world to choose from. They include places like Switzerland, the Channel Islands and Liechtenstein, but many are in the Caribbean, according to CBC News . It further lists out how easy it is for wealthy foreign investors to move money in and out of offshore companies and other structures.