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Notice Account

Many banks provide offshore accounts based in the Channel Islands and the Isle of Man. Interest is paid into the account gross but has to be declared as income.

Notice accounts require notice to be given to withdraw funds to avoid any penalty, such as loss of interest. The amount of notice that needs to be given depends on which account you choose.

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It may be possible to operate these accounts via a branch, telephone, post or the internet. Obviously, if you choose an account which is operated by post, telephone or the internet, there will be a delay in receiving funds due to how these accounts are accessed.

Some accounts may offer facilities such as a cash card or passbook.

Things to watch out for:

• Minimum balances - with some savings accounts there is a minimum amount you have to put in to open the account.
• Withdrawals - Some savings accounts include conditional bonuses in their rates of interest. These often relate to the number of withdrawals that are made over a certain time period. If these are exceeded, interest can be lost.
• Unconditional bonuses - some savings accounts include a bonus rate of interest until a certain time. These savings accounts can offer an attractive return at outset, but can reduce considerably once the bonus rate ends. If you choose a savings account with a bonus rate it is worthwhile reviewing the rate once the bonus term ends.
• Rate guarantees - some savings accounts will offer a guarantee on the rate of interest you receive, despite being a variable rate account. These often relate to the Bank of England base rate. Some rate guarantees have the same effect as a bonus.
• Conditional bonuses - These can include obtaining a higher rate of interest if you hold your current account with that provider, or if you do not make many withdrawals over a certain time period.