the freedom to deal in more than one currency. Unlimited access to your account is also useful for business people who frequently move through time zones. Added to this, by going offshore, you can choose from thousands of funds that can improve the diversification of your portfolio. You can also get access to expert fund managers that are not available in the UK.

Who can invest?

Any adult can invest offshore. In order to work out what your tax position will be it is important for offshore investors to know two things: What your domicile is, and whether you are a UK resident. An individual acquires a domicile of origin, which is usually the same as that of his or her father. If you were born in the UK and it is your permanent and natural home it is generally the case that your domicile is the UK. Non-domiciliaries can protect their income and gains on overseas assets from UK tax, including inheritance tax, as long as they do not bring them into this country. If you are married to a non-domicile, there are tax advantages to putting non-UK assets in the name of your spouse. If you live in the UK for more than 6 months of each tax year you will generally be treated for tax purposes as a UK resident.

Tax is traditionally seen as the driving force behind investing offshore. Residing in high-tax areas such as the UK, people make offshore investments, in pursuit of higher returns and without the intention to evade taxes in their home countries. Increasingly offshore investments are being seen as a valid financial strategy for everyone. Yet new rules brought in by HM Revenue and Customs (HMRC) have brought a change for those who have invested offshore over the years in offshore accounts and those wishing to begin their investment portfolio outside of the United Kingdom.

Individuals who are resident in the UK are liable to pay tax on their world wide income, meaning that if you have, or have previously had an offshore savings account you should declare the interest earned to HMRC and pay any due tax. This includes accounts in the Channel Islands, the Isle of Man and the Republic of Ireland. Your money is exempt from this process if your total income from all sources, including the offshore account, is less than your tax free personal allowance. In 2007/8 this stands at