United Kingdom Banking

The UK is a popular choice for banking for non-UK entities. This is because bank balances and income are not taxed so long as the account holder (and beneficial owners if the account is in the name of a company) are not connected with the UK and the income does not arise in the UK. For this reason many foreign companies bank in the UK. In all cases an element of tax will be payable in respect of interest earned on the account (which does arise in the UK) but this can be deducted at source and may be negligible. Many clients prefer the reputation of a UK bank account and feel it adds legitimacy; having UK presence without the use of a UK company. A limited liability presence can also be achieved in the UK without paying UK corporation tax through the use of LLPs which may bank in the UK. The UK is a well regulated country and account opening requires a high degree of formality and may take considerable time - say three to six months for foreign companies owned by persons not known to the UK bank. There is also an element of cost since UK banks will generally require documents to be certified under apostille (see our main article on documentary services in the products section for more information) and may even request meetings with the beneficial owners (though this is not usually the case). It should be noted that UK banks are fairly risk adverse and will require a thorough understanding of the activities of the company and conduct background checks on its directors and owners before they will open accounts.