Offshore accounts....

I've been told by my accountant to open an offshore account through HSBC or Barclays in Jersey, Channel islands.

My Q is....are all offshore islands the same?  Meaning i know lloyds has one domiciled in isle of man.  is that equivalent to jersey?

Basically i'm cranky about the £5K minimum for the HSBC account, as i don't want £5K just sittig around making no interest....just to get a tax break.

It makes sense for my situation, especially this year since i will be out of the country TONS for work and know i can get a UK tax rebate.....i just want to be sure i am opening the acount in the right island!

Your accountants are correct: an offshore account will save you UK tax money in your particular case.

All offshore bank accounts have the same tax benefits.  Offshore accounts at banks near the UK, such as Jersey, Guernsey, & Isle of Man, are linked into the UK banking system and work seamlessly to allow you direct debit your rent, utlities, and other UK bills and to direct deposit your paycheque.  You could also use an offshore account far away, such as the USA, but these will not allow direct debits within the UK.

Barclay's Private Banking has three branch offices in London and requires money going through the account of £100,000 per annum - but no minimum balance per month.  I'm not sure what the others offer.

Thanks Liz,

As always you are extremely helpful. 

You need to be aware that in addition to income tax benefits from holding an offshore account that there are several other issues:
1. An account held outside of the UK may require your Will to be probated in more than just the UK and US.  Death is never nice to think about but asking the question before you choose an Island will assist (probate rules are different in Jersey, Guernsey, Isle of Man, Alderney and Sark respectively).
2. Don't forget to report these accounts to the IRS on form 90-22.1.
3. Your accountant is forbidden from providing investment advice so cannot advise which account or bank is best for you, so do investigate for yourself!
4. Your accountant should advise you to keep seperate capital accounts, income accounts, capital gains acvcounts plus possibly other accounts for offshore earnings.  Make sure you understand at the start since getting the structure right is very important.
5.  Don't forget that the interest remains taxable in the States.
6. You'll also need to complete the bank's paperwork on the EU Savings Tax Directive. Your UK accountant can assist here too.
7. The SEC provides some investor protection for accounts held onshore in the US.  The FSA provides some protection for accounts held onshore in the UK.  Neither of these regulators apply offshore so do ask what the investor protection rules are in the Island you select.  The rules are once again different in each of these islands.
8. Do choose a major high street UK bank because these are less likely to fail and if they do they will more likely be bailed out by the Bank of England!
Good luck!

I am also thinking about opening an offshore account.  Most likely with HSBC as that is where I have my current and savings accout.

I have one with NatWest.  Seems as good as any others...I did not do any research as they have a relationship with my employer.