Off Shore Accounts
Many people – when they hear the phrase Off Shore Account – believe it to be something shrouded in mystery and something which may even be illegal; this is simply not the case.
Anyone who wishes to have an Off Shore Account can do so and many of the high street banks can facilitate your requirement for such an account upon request.
What is an Off Shore Account?
An Off Shore Account is exactly that; an account which is held Off Shore in a bank or financial institution not based in the United Kingdom. There are many – as we have already mentioned – high street lenders who can facilitate your request for an Off Shore Account and can administer it for you if you so desire.
Off Shore Accounts however do require that the individual using them has a significant amount of money to hold Off Shore and these accounts are normally opened with anything from three to five thousand pounds.
Off Shore Accounts also offer the opportunity to pay less tax than would be applicable if the money were held in an account on the British mainland and many see this as being the main benefit of opening such an account.
Off Shore Accounts can be held in any country outside of the United Kingdom but generally the most popular countries are Jersey, the Dominican Republic, Switzerland, France and Latvia.
Who Administers My Off Shore Account?
Your account will be administered in the same way it would be if you held it in the United Kingdom – by the bank with which the account is based. They will produce statements as normal and will offer advice on investment opportunities, interest rate rises and other products they offer just as a UK bank would do. You can also administer your account online or by telephone and can move money from place to place via telegraphic transfer should you so desire.
Why would I want an Off Shore Account?
As we have already touched upon the main reason for requiring an Off Shore Account is to reduce the amount of tax paid on your savings. Many people find that their savings – depending on the amount – are taxed highly and therefore feel it wise to move their monies and investments Off Shore to reduce the amount of duty paid. It also means that if you are what is known as an ‘ex-pat’ you may find you can pay less income tax as well if you spend a period of six months or more outside of the United Kingdom in any one year.
Off Shore Accounts and Your Will
If you have an Off Shore Account – or wish to set one up – then you must adjust your Last Will and Testament accordingly. You must make it known to the bank that administers your Off Shore Account that you wish to have a solicitor – or executor of your will – have access to this bank account in the event of your death. This may require making your solicitor – or executor – Power of Attorney which gives them legal right to move funds and operate accounts and other financial concerns on your behalf.
Along with your will it is wise to include copies of paperwork received from your bank to minimise the risk of administrative hold ups and you should also consult with your bank and provide their legal team with a copy of your will once you are satisfied it will not change.
In the interim period – as always – it is best to consult with your solicitor or a financial advisor before embarking on the setting up of an Off Shore Account or changes to your will relating to an Off Shore Account.