Are your savings safe? article discussion

silvercar

If you take money out of the business you are effectively taking a director's loan account. You would be personally liable for the benefit of the money on your tax return and need to include this on a P11D. The company could also be liable for NI contributions on the money. The loan has to be repaid within 9 months of the year end or there are corporation tax implications.

There used to be a loop hole, where the loan would be repaid the day before the year end and then taken out again in the new company financial year (to be off the balance sheet). I'm not sure on the legalities of this, it may just have been an option to slide under the radar.

mike_in_easenhall

I have read your article on safety of Icelandic banks and I fully understand that Kaupthing Edge savings are now (as of today) protected up to £50000. However, what would happen to my savings if the Icelandic government nationalised the bank, as they have just done with Icesave, the consequence of which is that deposits and withdrawals are frozen. I know my money would still be safe, but how long could or would it remain frozen. Any views from the experts?

silvercar

kaydeed wrote: »

if i was to take £ 100,000.00 out of a small buisness account and set up a normal joint named bank account instead of a buisness account with a few different banks . Is my money safer and would this pose a tax problem.

answer on small companies here:

I run a small business, what about me?
"The deposit protection scheme was set up primarily for private individuals, the FSCS says.

But small businesses get similar protection to savers if the limited company can satisfy at least two of the following three criteria:

A turnover of not more than £6.5m
A balance sheet total of not more than £3.26m
A total number of employees of not more than 50.
Partnerships - not the individual partners - could claim up to £50,000.

For a sole trader account, the sole trader could claim up to £50,000 in total, but can only claim for either personal or business accounts with each institution - they cannot claim for both. "

From BBC article here:

http://news.bbc.co.uk/1/hi/business/7482914.stm

highguyuk

A quick message, in that I've emailed brokenlink as regards to this article with perhaps a couple of corrections.

Snapper22_2

This is a general question although the accounts I have in mind are Icesave! None of the internet bank FAQs (as far as I can see) draw any distinction between "normal" deposits and fixed term/fixed rate "bonds". I have 2 issues actually. Firstly are fixed rate bonds covered by the Financial Services Compensation Scheme? From what I read on the FSCS site, I believe they are, but it's not absolutely clear. Secondly, in the event of a winding-up of the bank, would the fixed rate bonds be subordinated to shorter-term deposits? Again, I don't see any reason why they should be; they are, after all, just another form of deposit, unlike, say, an investment in the bank by way of shares or subordinated debt. Grateful for any informed input. Thanks.

dunstonh

None of the internet bank FAQs (as far as I can see) draw any distinction between "normal" deposits and fixed term/fixed rate "bonds".

Thats because there isnt any.

The deposit protection sceheme protects deposits. These bonds you refer to are not real bonds. They are misnamed by marketing men. Their correct title is fixed term deposit.

Secondly, in the event of a winding-up of the bank, would the fixed rate bonds be subordinated to shorter-term deposits?

They are treated as part of your deposits balance.

I_M_Robson

Re compensation paid out for a cash isa, does it still come with an isa wrapper?
ianr

TheBigQuestion_2

Extract from the BBC news site
"European Union finance ministers have agreed to increase the guarantee for customers' bank savings accounts to at least 50,000 euros ($68,250; £38,900)."

In my opinion given the past few days with ireland , germany(although not sure of the exact deal here) both increasing their protection to unlimited and the uk to £50K, this lower figure( although its a minimum) will only cause concerns that the saver will not be proteted!!!!
What are the goverments trying to do, produce mass panic, or transfer of funds to countries who claim to have 100% protection!!!

If the giverments really believe the money is safe then it should be protected 100% as it is a no risk option (if the banks are really safe).

Stuey74

I have a basic question, but wondered if anyone here could offer some advice?

Does the FSCS cover current and saving accounts? I still have a Barclays Open plan account, which has multiple 'savings pots'. Are all these and my current account covered or do I need to move the money in the 'savings pots' into a specific savings account? (combined they don't exceed £50K)

dunstonh

Does the FSCS cover current and saving accounts?

They are deposits.

It isnt a savings protection scheme. It is a deposit protection scheme. So reference to savings isnt required.