Utilising 90 day Notice Accounts
By thinking outside of the box when it comes to the best use of UK investment accounts one great tip is when using a notice account, there are ways to achieve higher interest rates, and still get access to the capital within.
For example, on a 90 day notice account by writing a monthly letter to the bank notifying them “you are informing them in writing that you wish to withdraw the money,” (but not actually doing so), the investment account can effectively become more like a current account in practice.
By providing notice to withdraw during the 90 day notice period it could become a higher interest instant access account, however, you should always check the terms and conditions to make sure this is viable.
Offshore Investment Accounts
There are specialist investment accounts in existence which guarantee 100% of the investment with either a 10% cap, or no cap, depending on the type account opened. This can be achieved via a company name or private, and it can be done onshore or offshore.
This enables 5% of the original investment to be taken tax free annually. By not taking anything in the first year, 10% can be taken the year after and so on.
Offshore investment accounts will grow quicker because the interest gained is gross (no tax deducted), therefore, assuming 10% return over a 10 year period you will actually enhance your returns by 17% purely because of the effect of gross returns.
Even by deferring the tax payable until it’s brought it back on shore upon return to the UK, the investment will still have grown at a greater rate than if tax had been deducted at source.