Offshore Savings Accounts - what are the benefits?

markizok

Hi all

I am still trying to work out what is best for me - i have seen on off shore savings acocunt with Northern Rock and wonder how this differs from a normal savings account?

Thanks
Mark

grumbler

AFAIK, no benefits for UK residents besides you can defer interest untill you retire and pay less tax on interest.

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Cook_County

There are still significant advantages to offshore accounts for UK residents (even if they are UK domiciled).

1. The interest is credited gross so you get deferral before paying tax.
2. Interest rates may be higher.
3. Service may be better.
4. If you expect to leave the UK there will be tax advantages.
5. For children or adults who can't fill out an R85 it saves paying tax now and having to claim refunds.

Of course the interest is declarable unless you are not domiciled or not resident in the UK, in which case you should not have money onshore at all.