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Expat Investor : September 2007
Offshore banking -- practical and purposeful products Expat Investor toured the offshore banking market to report on what's new, innovative and useful for the global expatriate community. Offshore banking from centres of excellence such as Jersey, Guernsey and the Isle of Man has long been known to facilitate the expat experience of living and working away from the UK. The solid reputation of these offshore centres comes from the products and services -- the money tools -- offered different time zone." Abbey International reports that it has developed what it calls "an intuitive and comprehensive internet banking system for its clients, with very high levels of support, functionality and security coming as standard." Its internet banking system offers simple navigation, money transfers between accounts and a website that is clear and simple to use, giving 24/7 access to accounts from around the world. Abbey International explains that it also offers a "peace of mind guarantee". This means should you lose any money when using the Bank's online services, it will pay you back any loss you incurred from fraud providing you have taken all necessary safeguards to keep your account secure. The bank offers a range of accounts, including its Gold, Call and Notice accounts. All of these can be managed via their internet banking service, so customers can log on, pay bills and move money between multi currency accounts from the comfort of their own home, with Gold and Call accounts offering the added benefit of a choice of three currencies, sterling, US dollar and euro. Gary Quaggan, Head of Personal Savings at Anglo Irish Bank IOM, is keen to emphasise why saving accounts play a key role in any expat's financial planning. "Expats face special challenges when it comes to looking after their money. The good news is that being an expat means you can take advantage of a variety of financial opportunities not available to other people, such as having interest on your savings paid gross, and the option of using multi-currency accounts. "At Anglo Irish Bank, we specialise in savings and offer a range of accounts, each designed to do something different, and fit into an expat's lifestyle. It's advisable to keep some money readily available, and our Privilege Access Account combines immediate access to your funds with the sort of rate normally associated with a notice account. Many expats value the ability to receive income from their savings on a monthly basis, perhaps to cover recurring bills, or because they are retired and want regular income. With our Privilege Income Account, interest can be sent to a nominated UK bank account, or added to your account each month." Mr Quaggan goes on to draw attention to the Bank's notice accounts, which regularly make OFFSHORE BANKING expatinvestor.com 6 EXPAT INVESTOR September 2007 appearances in the best buy league tables. "Anglo's Privilege Fixed Interest accounts are available for 12, 18, or 24 months, and offer the added flexibility of access to 20% of your capital per annum, without any penalty. All Anglo accounts come with a pledge to keep rates competitive over the long term, something which particularly appeals to expats who tend to have busy lifestyles, and can't always be expected to follow every rate change in the savings market." Close Private Bank has its sights set on longer-term savings plans, notably international retirement planning. Managing Director Rex Cowley, tells Expat Investor,"The importance of portability, security and flexibility is critical in financial services especially if you live outside of your home country with the possibility of returning or if you have the potential to move from one country to the next. "Close Private Bank Group is the leading provider of wealth management solutions to facilitate mobility, provide tax efficiency and still ensure that you, the client, retain control of your monies without any access restrictions, redemption penalties or onerous costs. These points are referring to Close Opes, our award-winning international retirement and saving solutions. With a minimum annual contribution of £6000, Close Opes offers a full range of investment programmes ($, £ & ) from cautious to growth, inclusive of an absolute return investment strategy or managed cash for the very risk adverse." The Bank points out that the Opes' structure gives each client the ability to tailor the plan to suit their needs, both pre and post retirement, and manage the transfer of wealth to future generations without the costs associated with private trusts or the inflexibility of certain life products. "Opes offers a life-time planning structure that can change as your needs change without lock-ins or penalties and, should your planning require it, provide easy exit." Chris Blampied is Managing Director of Royal Bank of Canada (Channel Islands) and he makes the point that whereas offshore banking is commonly misunderstood, the rationale behind it tends to be straightforward. "For the majority of wealthy individuals, there will be an obvious reason for instigating an international banking relationship. Typically, clients are by their banks which reflect the changing dynamics of international financial management. Mark Waterhouse, who heads up Zurich Bank International on the Isle of Man, explains the basic division between offshore and local banking. "To achieve the best possible return on your hard-earned money the bulk of your funds could be in an offshore savings account such as an easy access account or a fixed rate term deposit account. These products normally pay higher rates of interest than current accounts. "Moving your savings offshore from a UK bank account can also bring benefits such as cost-effective currency conversion and the quick and efficient transfer of funds to foreign banks. Zurich Bank International offers accounts in a range of currencies, with the additional benefit that interest on your savings and investment accounts may be paid gross; without deduction of tax at source, however, you may have a liability to tax elsewhere." Although the bulk of your savings can still be in the currency of your home country, you could have some of your accounts denominated in the currency of the country in which you are working or living. "Foreign exchange fees, ATM and credit card charges can now work out very expensive, both for cash withdrawals and increasingly for purchases in shops and restaurants and for regular transactions. It makes sense more than ever before to hold a local currency bank account for the payment of small items and for cash withdrawals," stresses Zurich Bank International. Abbey International flags up the significance the internet plays in international money management and monitoring. "For the expatriate living away from home, one of the most important areas to keep tight control over is day-to-day money management. "Offshore bank branches do not exist as they do in the UK, so working and retired expatriates have to rely upon the phone, post, fax or, increasingly, the web to get their finances under control," says Business Development Manager Jane Matthews. This Jersey-based Bank says few organisations offer fully comprehensive banking services via the web, with most requiring their clients to transact via the post, fax or phone, none of which are particularly secure in the current climate where identity theft and mail theft are an all too frequent reality. "The great advantage of internet banking is the freedom to organise transactions, check statements and set up standing orders and direct debits at a time convenient to you. It is particularly useful for expatriates who don't want the cost or difficulty of trying to deal with their bank in a Call Lisa Cox on +44 (0)1903 231 545 or visit www.thefrygroup.co.uk *source: www.hmrc.gov.uk/about/reports.htm The tax system is becoming more complicated, and important changes have been made to the 2006/7 Tax Return. Over 30% of self-assessed forms were wrong last year* - so how do you know your Tax Return is correct? The Fry Group offers specialist tax advice to expatriates. We recently saved one of our new clients £30,000 simply by checking his last Return. Can you be sure you're not in for a shock from the taxman? Contact the Taxperts Expert tax and financial planning for expatriates since 1898 The Fry Group Some things are betterleft to the experts Fast Facts 77004
July August 2007