Business Bank Account (when primary income will be in USD)

oracle3001

Hi,

I have just landed a contract to license some software I have written in the US. I have taken the appropriate step of setting up a limited company and now require to choose a suitable business bank account to collect the licensing fees, which will be exclusively in USD (and there is no negotiation over being paid in any other currency).

The income from this software is unlikely to be particularly large (i.e sub £100k) and will be paid monthly by bank transfer.

I presume if I just open a GPB business account with a high street bank I will be killed on fees / exchange rate on these regular transfers.

Which accounts would posters recommend I look at? And how does having all the money paid in USD effect my tax situation?

paddyrg

Tax-wise, not really my area, but you do need to take advice to ensure you're not taxed twice - in the US and the UK. If we're talking $100k, it's a big enough sum to get proper advice from a tax advisor.

You could open a USD account in the UK, but you then run the risk of exchange rates going for or against you. If you have a GBP account, you'll get hit on the currency exchange, but it's not that huge a deal - maybe a tenner or so in international transfer fees plus the bank's spread on the exchange rate.

You could also look at companies like CaxtonFX for transferring/converting cash - bit cheaper, but for the extra hassle and potential risk/complications may be worth leaving up to the bank.

Brassedoff

If you are looking for a bank account, any high street bank offers forex accounts. If you make +$30K transfers, then I have used and passed clients on to http://www.ukforex.co.uk accounts. It is at the wholesale rates, you'd hedge an extra 3-4 %, its just like a UK bank account, based in the UK and haas the same safeguards.

The best way to keep taxes to a minimum on any type of international sales would be to channel them through a non domicile off shore country. If its the states you are primarily going to deal with, the Caymans, Delaware etc, then bring it into the UK.

I am not allowed to tell you more of what I do on this forum as the mods have deleted my posts, but I hope there's some pointers. Oh, finally, make sure the bean contrt knows what they are doing, otherwise you will get hammered the 21+8%. There's some really clued up 'wealth creation experts' out there, they are different to accountants who deal in the local butchers books.

If you need any more, just ask, if I can help I will.