The short version: An offshore account is simply a bank account or investment held in another country. Despite the shady reputation, they’re perfectly legal. What matters is whether you declare the income to HMRC.
Do you pay UK tax on offshore accounts?
If you’re a UK tax resident, yes. You’re taxed on your worldwide income, including interest, dividends, and gains from accounts abroad. You declare it on your Self Assessment tax return and pay tax just like on UK investments.
Why the bad reputation?
Some people used offshore accounts to hide money from HMRC. That’s tax evasion and it’s illegal. HMRC has cracked down hard, with information sharing agreements between countries and severe penalties for non-disclosure.
What about non-doms?
Non-domiciled residents used to be able to keep foreign income offshore without paying UK tax (the remittance basis). That regime is being abolished from April 2025, so this advantage is disappearing.
Do you have foreign accounts?
If you have money abroad and haven’t been declaring it, you need to sort it out. HMRC’s penalties for offshore non-compliance are higher than for domestic issues. Coming forward voluntarily is better than waiting to be caught.
Have offshore income you’re not sure how to handle? Get confidential advice on your options.
