Business people

The truth about offshore

Wil Beaumont, Regional Director, reveals the reality of what offshore banking can offer.

Q: Why would a business require an offshore bank account?

A: The requirement for an offshore account usually relates to some form of taxation planning – the business could have an offshore subsidiary with non-UK trading income, for instance. We have 0% corporation tax in Jersey, meaning you have free withholding tax on dividends, interest, any royalties, the list goes on. As a bank, we can’t give tax advice, but a business would usually be recommended to us by an accountancy firm or an offshore tax specialist.

Q: Why has offshore banking had such a negative press?

A: There’s a huge difference between the perception and reality of offshore banking. The offshore islands have been transformed over the last ten years, and are actually ahead of the UK mainland in terms of transparency. Tax haven bashing, however, makes good headlines, particularly when the government is trying to meet financial deficits. It’s not some kind of secret club, as the media often portrays! 98 out of 100 FTSE 100 companies have offshore subsidiaries.

Q: What kind of business might benefit from accessing offshore banking?

A: A business would really need surplus funds of well over £1 million for it to be cost-effective to put in place offshore solutions.

Q: What should a business consider when looking into offshore banking?

A: Any business considering offshore banking needs to have access to high-level, professional accountancy and taxation advice – moving into offshore shouldn’t be done lightly, as it is fairly complex. You should also consider where you want your offshore finance centre to be, which could be linked to proximity to the company’s main trading hub. Reputation is also crucial, with Jersey deemed the number one offshore destination for most of the UK, highly regarded by the International Monetary Fund (IMF) and the Financial Action Task Force (FATF). It has particularly excellent links to London, and all the big four accountancy firms are represented here.

Q: What does Santander’s Jersey Corporate Business Centre offer?

A: We are an approachable team, with 75 years of offshore banking experience between us. If it’s been done offshore, we’ve no doubt got first-hand experience of it! We provide a full suite of corporate banking products, covering the whole spectrum of assets and liabilities. We have particular excellence in deposits, from instant access to time and breakable deposit accounts, as well as cash pooling arrangements. This is largely in Sterling, but we also offer US Dollar and Euro options. We’re happy to speak to anyone who’s thinking of offshore as an option – although we can’t give tax advice, we can recommend someone who can – and then guide you through the process.

For more information on Santander’s Corporate Business Centre in Jersey contact the team on: 01534 7677 50 or email: jerseycbc@santander.co.uk

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