Hi
I'm not sure if this is the right forum to post this question. I am just about to take a job in Saudi Arabia. I'm thinking about opening an offshore bank account before I leave the UK but I'm concerned that my money would be at risk if any of the banks got into more trouble. I'm leaning towards one of the banks located in the Isle of Man but I'd be grateful for any recommendations. The account will be used as a current account for now and then once I've earned some money I'll open a savings account.
Thanks

If you nolonger had a UK address, you wouldn't have a choice but as you are still in the UK, there is no need and no advantage (but, as you say, a few disadvantages) to offshore accounts.

You should talk to whoever you bank with at the moment to make sure that you can keep the account going with an overseas address (or you could use the address of a trusted friend or relative). Some banks and building societies will let you keep an account while overseas as long as it is opened while you are in the UK. No UK banks will let you open a new account without a UK address so you need to get things sorted before you go while you have more options.

Okay this is what you should do. Google expat tax guide and you will find many online sites that offer EXPERT advice.

I have a good friend who is working in Qatar, and he uses HSBC because they are a true international bank offering services for such a situation, although they are not the only one.

HSBC Bank International Limited are registered in Jersey where the depositor protection is weaker than even the Isle of Man offers, as savers who invested there via Icelandic banks found out at great cost.

I agree that op should look beyond these boards for decent advice. As mentioned, a branch of the current bank would be a good starting point.

Before going for an offshore account, take a good look at www.safeoffshoreaccounts.com, or any of the other websites on the matter, and all the threads here from people who've lost money in offshore accounts, and avoid the sleepless nights....

Having said that, HSBC is probably one of the least likely to go under (no guarantees!).

Best thing would be to open whatever accounts you want in the UK while you can, then (after opening them) change the address to your parents, and don't tell the bank you're off abroad. File an R85 to get gross interest (don't file an R105, that gives the game away, and they'll tell you you have to move your account offshore).

Thanks for all the responses and ideas.

I have been Expat for 18 months now and have trawled through loads of information on offshore banking in order to keep my money safe. Tax advisers are great for helping reduce your tax bill but for determining how safe a bank or guarantee scheme is, do the work yourself by reading TRUSTED financial sites.

I have moved my capital a few times and it is now split between UK Mainland and USA banks to make full use of the Guarantees of FSCS and FDIC.

Forget using R85 Form, this is for UK Residents whose earnings or pension are under the relevant personal allowance in the tax year. Instead use the R43 form and claim the tax deducted from interest back every year, you are elegible for the usual personal allowance of £6475 as an expat British Citizen.

Great advice to use UK Bank accounts with a trusted relative's address for statements and correspondence and steer clear of vast majority of IOM and Channel Island Banks becuase of the flawed compensation schemes.

I pulled my house sale proceeds out of A & L IOM last October after KSF failed because of the useless compensation scheme in the IOM. KSF depositors are still waiting for their claims to be settled.

Also I would avoid the link to safeoffshoreaccounts.com on one of the above posts, my anonymizer software flags it as a dodgy site (eg spyware or keylogger or virus infected)

Most likely Google cookies. Internet Explorer 8 says the site is safe, and you can use the privacy link at the bottom to turn off Google advert "interest" tracking, if you care.

Anyway, as my name gives away, I had (still have, unfortunately) money in Landsbanki Guernsey, and I found that everything the site reports about Guernsey is right. Dunno about the IOM and Jersey pages, but I suspect the same is true for those as it's all backed with scores of links to newspaper articles and official sites, the islands' compensation schemes, even the OECD. Cos of all the links and references I found this to be the best all-in-one-place reference on the matter, but each to his own.

Re R85, it's the no-hassle option, just file it once with each bank and that's it, no messing with reclaiming tax every year. Of course it's not kosher, but neither is giving banks a "false" address and leading them to believe you're resident when you're not!

Also, if you're in that league, UK banks will give you interest gross if your deposit is over £50k anyway.

lgsaver:

Most likely Google cookies. Internet Explorer 8 says the site is safe, and you can use the privacy link at the bottom to turn off Google advert "interest" tracking, if you care.

Anyway, as my name gives away, I had (still have, unfortunately) money in Landsbanki Guernsey, and I found that everything the site reports about Guernsey is right. Dunno about the IOM and Jersey pages, but I suspect the same is true for those as it's all backed with scores of links to newspaper articles and official sites, the islands' compensation schemes, even the OECD. Cos of all the links and references I found this to be the best all-in-one-place reference on the matter, but each to his own.

Re R85, it's the no-hassle option, just file it once with each bank and that's it, no messing with reclaiming tax every year. Of course it's not kosher, but neither is giving banks a "false" address and leading them to believe you're resident when you're not!

Also, if you're in that league, UK banks will give you interest gross if your deposit is over £50k anyway.

Soon to be Expat and lgsaver

It is not the Banks you have to worry about when using form R85, it is HMRC. Read the notes carefully and do not mess with the taxman. Recently they have started doing more and more checks and they will get round to dealing with R85 forms etc. Recently there have been backlogs while they deal with refunding the tax claimed back via the R43 form. The R85 is just held by the bank but they can be checked on at any time by HMRC. Link to R85 form and notes is below, check page 5 and you also need a UK postcode when filling in the form. Personally, I would rather stay safe and use the R105 and R43 forms and a couple of postage stamps but it's your choice.

http://www.hmrc.gov.uk/forms/r85lp.pdf

Banks /Building societies like Nationwide and Smile will let you keep an account open if you do go offshore after you open the account. Smile will pay interest Gross but Nationwide don't so you would need the R43.

Regarding the message about the site being unsafe, it is most probably one of the links within the page that does the damage. I run Norton 360 v3 along with Anonymizer as a backup because it detects some instances of phishing/pharming/spyware etc that Norton lets slip through. The Google advert interest tracking has never given a problem so far and can be useful. In the past I have tended to get more Spam and other hassles through financial links including a free offshore savings report. I just like to keep my PC fully protected as I trade largish amounts through stockbroking accounts trying to beat the 2% interest available with banks these days. Bring back 6% interest though and I will leave the shares alone.....

lgsaver, how are you getting on with claims against Landsbanki Guernsey, I haven't followed it up for a while after I heard that they were to pay out 30% of deposits as an initial payment. I heard KSF (IOM) depositors have the choice of liquidating the bank instead of accepting a Statement of Affairs. I originally had my house sale money with Icesave UK but read a Telegraph article about the cross-investing between the Icelandic banks back in February 2008, I was lucky enough to have read the article and moved my deposit, but Brown and Darling had also been told about the chances of a future collapse but chose not to inform the British Public.

Re R85: I did say it isn't kosher :-) As for a UK postcode, obviously you'd use the same address you gave the bank. Yes, there's a (small) risk of being found out, although it's not clear what would happen if you were - after all you've not evaded any tax, you're not liable for any anyway.

Anyway, the reason for mentioning R85 is that I know of numerous expats who filed R105s when they moved abroad and were promptly told by their lifelong UK banks that they could no longer keep their accounts, and were referred to the bank's offshore subsidiary. I don't remember if Nationwide or Smile were amongst them, probably not by what you say, but the list is long....

safeoffshoreaccounts.com doesn't ask for your email address (or any other info for that matter) so you won't get any spam from that -- but I think I know the "free offshore savings report" you're talking about! :-) (Found in a google ad, yes?)

There are email services, like BT/Yahoo, which let you set up disposable email addresses, i.e. an address that comes to your email but isn't your main email address, which I find very useful for giving to such sites. You set up a disposable address for giving to the site, and if you start getting spam to it you simply dispose of that address, and the rest of your email is unaffected.

Re Landsbanki Guernsey situation: no change. Yes, we got back 30% last November, and have been told to expect another 15-25% later this year, but also told that we'll most likely only get 70-80% back in total in the end, and that it'll probably take another 3-4 years for that to happen :-(

The KSF IOM depositors voted for liquidation. I'm not in KSF IOM, so don't know much more myself, but the aforementioned site has links to news reports etc on that.

Re R85, I know where you're coming from with your reasoning but I want to stay on the right side of the tax laws and I had Citi asking me to change to their Guernsey branch so gave them a relatives address instead and will claim back the tax via the R43 form with the tax certifcates. It isn't really a hassle but just takes time for the refund to be credited back to your bank account.

I had no spam through Google with 2 email addresses for over a year and then signed up for Financial software trials like where you would normally pay $150 a month for trading software but get 30 days free, then the spam comes through thick and fast after cancelling the free trial. Spot on too about the "free offshore savings report".

To get around this spam hassle I use Anonymizer Nyms for the email anonymous addresses @ $20 per year and Anonymizer software for safer browsing and varying IP addresses @ $30 a year. I know I can get these free but 50 bucks ain't bad, I used the BT/Yahoo emails that you mentioned but BT stopped my email addresses a few months after I stopped BT Broadband and left the UK.

Sorry to hear about your expected partial loss with LG, I am of the opinion that the Government should have backed savers on IOM and the Channel Islands because the interest is taxable back here in the UK. I shall restrain myself from making any more comments about El Gordo's financial errors, I said to my Missus we would leave if Britain adopted the Euro currency or El Gordo became PM.