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What is an offshore bank account?

An offshore bank account can make managing your money overseas easier.

Overview of offshore accounts

An offshore bank account (also known as an overseas or non-resident account) is one you open in a country or region other than where you live. While the term may have originated from the Channel Islands being geographically "offshore" from the UK, nowadays it can be used for any bank account that offers similar advantages.

An offshore account allows you to make and receive payments, hold money, and set up savings and investment accounts in at least one foreign currency, and sometimes in multiple currencies.

Some of the more well-known locations that offer non-resident accounts include the Channel Islands, Isle of Man and Singapore.

Is an offshore bank account right for me?

Offshore accounts can make it easier for you to save, manage money, make regular international transfers and invest if you have financial commitments in different countries or regions.

In addition, if you live in a politically or economically volatile country, you may also want to consider holding some of your money in a more stable currency.

An offshore bank account might be right for you if you:

  • regularly travel to different countries for work

  • plan to move abroad for work, or to retire – or you already live overseas

  • own property or have other investments in another country

  • are sometimes paid in a foreign currency

  • provide financial support for family members who are overseas, such as paying a child's school fees or a relative's care costs

  • are an ambassador or someone with an international role who moves for work frequently

Moving abroad? Our country guides are designed to give you some of the essential info you need in your first 3 months and beyond.

What are the benefits of an offshore bank account?

The most obvious benefit of an offshore bank account is that it decreases your need to move money between currencies. This in turn cuts down on bank charges and any worries you may have about currency fluctuations.

Offshore accounts can also offer a tax-efficient way to save and invest, but any tax benefits will depend on your circumstances.

While each offshore account will come with different features, you can usually expect to:

  • hold money, and make and receive payments, in various currencies

  • access international expertise and investment advice

  • manage foreign exchange to your advantage

  • keep the same bank account every time you move

  • keep your money in a secure, central location, connected to your local accounts

Offshore or overseas bank accounts usually have all the features you would expect from a local bank account, such as a debit card and online or mobile banking, with the convenience of international banking.

What to consider when looking for an overseas bank account

An online search for "bank accounts for foreigners" currently yields more than 26,000 search results. How do you sift through this information to find the account that's right for you? Here are some things to consider.

The reputation of the bank

No matter where you decide to keep your money, make sure you choose a reputable bank for your accounts.

Do you already have an account with an international bank? You may be able to open a second account offshore with them for seamless, global banking. For HSBC customers, if you've already qualified for HSBC Premier in another country, or you meet the eligibility requirements, you can apply online for an HSBC Expat offshore (Jersey) account.

The safety of your money

The security and quality of the offshore jurisdiction is as important as the reputation of the bank.

With an onshore account, governments in many countries will guarantee your deposits up to a certain amount. Some offshore jurisdictions may also offer some form of compensation scheme, but it's the stability of the financial environment that sets them apart.

Singapore, for example, is an offshore jurisdiction that offers a deposit guarantee if you hold your money in Singapore dollars. Likewise, HSBC Expat participates in the Jersey Bank Depositors Compensation Scheme. This offers protection for eligible deposits of up to GBP50,000, capped at GBP100 million in any 5-year period.1

It's worth checking whether this applies to the country you're looking to open an account in, and if so, what amount the government will guarantee.

The ease of remote account openings

Depending on the country you're hoping to open an account in and the bank you choose, you may be able to open an account remotely.

At HSBC, we offer remote account openings in 19 countries and regions around the world, including HSBC Expat offshore (Jersey) in the Channel Islands. Check if you meet the eligibility criteria and apply online.

Learn more about opening an overseas bank account

The minimum initial deposit

Each bank will set the minimum deposit required to open an account; some may have a minimum salary or regular income requirement as well. It's best to find out what this is before you choose an account, to make sure it meets your needs.

Tax

While offshore accounts could provide a tax-efficient way to save and invest, they are not tax-exempt. You must always disclose your income to any relevant tax authorities and declare any interest earned on offshore accounts. It's your responsibility to make sure you meet your personal tax obligations.

Ready to open an overseas account?

We can tell you the best way for you to apply for an overseas account. Simply select your current location and where you would like to open an account. We'll then walk you through the steps.

Disclaimer

HSBC Holdings plc has prepared this article based on publicly available information at the time of preparation from sources it believes to be reliable but it has not independently verified such information. HSBC Holdings plc and the HSBC Group (together, "HSBC") are not responsible for any loss, damage, liabilities or other consequences of any kind that you may incur or suffer as a result of, arising from or relating to your use of or reliance on this article. The contents of this article are subject to change without notice. HSBC gives no guarantee, representation or warranty as to the accuracy, timeliness or completeness of this article. 

 

This article is not investment advice or a recommendation nor is it intended to sell investments or services or solicit purchases or subscriptions. This article should not be used as the basis for any decision on taxation, estate, trusts or legacy planning. You should not use or rely on this article in making any investment decision. HSBC is not responsible for such use or reliance by you. Any market information shown refers to the past and should not be seen as an indication of future market performance. You should always consider seeking professional advice when thinking about undertaking any form of prime residential or commercial property purchase, sale or rental. You should consult your professional advisor in your jurisdiction if you have any questions regarding the contents of this article.

1 Full details of the Scheme and banking groups covered are available on the States of Jersey website, or on request.