How to handle your finances overseas

According to the ONS' Social Trends Report, the most preferred destination amongst British expatriates moving out of the UK was Australia, followed by Spain and France.  Furthermore, during 2005, Spain, including the Canary Islands, was the most popular destination for travel by plane by UK residents.

When moving abroad there are many aspects of life which you will have to adjust to and personal finance is no exception.  If you are planning to leave the UK to live temporarily or permanently overseas, you need the right products and services in place.  Offshore banking is a wise option as it enables you to hold money in most major currencies, whilst offering convenience and security. 

Once shrouded in the hype of expensive suites, flash boats and secrecy, offshore banking is no longer just the preserve of the mega-rich or millionaires.  Offshore banking can be a useful addition to the investment and saving portfolios of people with more modest means.

Here, Bank of Scotland International highlights some of the key benefits of offshore banking:

Tax incentives – Offshore banking can reduce customer's tax burdens quite significantly.  Interest is paid gross so that the customer can pay tax in their country of residence without being taxed at source.  However, if you accrue interest in an offshore account you still have to declare that on your UK tax return.  The important consideration here is that each country you live in has its own income tax laws by which you must abide.

1. – Offshore banking can be a useful addition to your investment and savings portfolio:

• • – Offshore banking enables you to conduct your banking business in other currencies.  These accounts are designed so that expatriates can pay their salaries or pensions into them, deposit money into other accounts, such as a local bank account in the country that they live in and to cover any bills or expenses that they may still have in the UK.
• • – These cover easy access accounts, no-notice accounts, fixed-rate accounts and monthly-interest account, which offer the option to save in different currencies, rates and terms.
• • – Tax-efficient offshore mortgages for those looking to buy a residential property in the UK.
• 1. – Providing the freedom to operate your account, regardless of time zone.
• • – For when customers need to convert funds from one major currency to another.
• • – Provides the ability to transfer money anywhere in the world, as a draft or electronically.
• • – Many offshore banks also have a team of independent financial advisors, who can offer a range of solutions to help you put longer term financial plans in place.

Tony Wilcox, Managing Director at Bank of Scotland International, said:"As an expatriate you need a firm foundation for your finances, no matter where you are.  Therefore it is  important to have the right financial products and services in place."