Best Offshore Savings Account (Gross)

ArranP

What are currently the best offshore sterling savings accounts? I'm interested in taking the interest monthly.

martyn4764

If you're non-resident, Bradford & Bingley's very good, just gone to 5.6% (bit less for the monthly option):
http://www.bbi.co.im/offshore-savings-accounts/offshore-internet-banking/e-access-account.aspx

If you're a UK resident, I dunno: though I believe the advantages of offshoring have been pretty much ended by the EUSTD Exchange of Information?

PropertyGuru

unless you offshore to somewhere outside the EU's jurisdiction.

macca64

FYI - The British Virgin Islands are meant to be a good tax haven.

Cook_County

Now you guys are confusing me:
1. If you are domiciled within the UK the interest is taxable in the UK wherever paid.
2. If you are not domiciled within the UK then the interest is not taxable in the UK unless remitted to the UK.
3. The EUSTD does not change 1 or 2. In the Channel Islands if UK domiciled you need to agree to exchange of information to avoid the EUSTD withholding tax. If non-UK domiciled, the Channel Islands will accept that neither the withholding nor exchange of information is required. Should EUSTD withholding be applied this can be reclaimed on a UK tax return in any case.
4. There are many valid reasons for holding an offshore bank account including payment of gross interest and deferral of payment of UK tax. You need to review the financial soundness of the bank and the investor protection scheme in your chosen island - only the Isle of Man has one - Jersey & Guernsey do not. Finally you need to check probate requirements in the island, because should you die you may not want to leave your heirs with costly legal bills to get your Will probated.

pksaraf

i am also looking for an offshore savings account. anglo irish bank looks the best to me so far - 5.35% on 7 days notice account or 5.30% for no notice account.

as this account will be for a non domiciled person, i dont want the interest to be remitted to uk. i am confused as to what options are available to remit the money as all these offshore accounts seem to only transfer money between the linked uk accounts and themselves. could anyone advise if there is a way to remit the interest earned to a third non linked account held abroad?

Cook_County

If you are not UK domiciled then you will need the bank to set up separate income and capital accounts. This is a standard tax planning technique so the bank should be able to arrange this.

pksaraf

cook_county, thanks for your reply. as most of the offshore banks ask for a minimum deposit amount before you can open an account, how can you open an income account to receive the offshore interest (as the balance initially will be 0), without actually putting capital in it? For this reason I thought the only way is to open one account for both capital and interest. could you clarify?

ArranP

the best offsore yearly interest account I found so far is the Bank Of Scotland at 5.65% Gross, no tax to pay. However I believe some 1 year fixed rate bonds can do better, anybody know of good performers in the bonds ?

ArranP

also, can one trade bonds tax-free / offshore ??

tom188

5.65% is probably about the maximum rate you can expect.

If you are a UK resident tax will need to be paid.

Investing offshore does not exclude you from paying tax on your income from these investments.