GBP Fixed Term Deposit — 6 Month

Investment Overview

This fixed term deposit places capital with an offshore-licensed bank for a period of six months, earning a fixed gross rate of 4.75% per annum. Interest accrues from the deposit date and is paid at maturity together with the return of the principal. On a six-month term, this equates to a gross interest payment of approximately 2.375% of the deposit amount at maturity (£2,375 per £100,000 invested, before tax).

The deposit is denominated in Sterling (GBP). Investors deposit GBP and receive GBP at maturity — there is no currency risk for GBP-based investors. For investors whose functional currency is USD, EUR, or another denomination, the deposit carries GBP currency exposure.

Why an Offshore Deposit?

Offshore bank deposits are placed with banking institutions licensed in offshore financial centres — commonly the Isle of Man, Guernsey, Jersey, Gibraltar, or Cyprus. These jurisdictions maintain well-established banking regulation, but the depositor protection schemes (where they exist) differ from UK FSCS arrangements.

For internationally mobile investors, offshore deposits offer several advantages: they are accessible from anywhere without requiring UK tax residency; they may be denominated in multiple currencies; and some offshore jurisdictions do not automatically report interest to the investor's home tax authority under certain account structures (though the investor remains responsible for disclosure and payment of tax in their jurisdiction of residence).

Interest Rate Context

As of mid-2026, UK Bank Rate stands at a level materially higher than the near-zero rates of 2012-2022. This has made fixed term deposits significantly more attractive as a capital preservation tool than they were during the prolonged low-rate period. A 4.75% gross return on a six-month GBP deposit substantially exceeds CPI inflation expectations over the equivalent period and provides a meaningful real return above cash.

For investors holding uninvested cash balances or awaiting deployment into longer-duration investments, a 6-month term deposit at 4.75% p.a. is a productive use of capital that does not commit funds for an extended period.

Deposit Protection Considerations

Unlike deposits held with FCA-regulated UK banks — where the Financial Services Compensation Scheme (FSCS) protects eligible deposits up to £120,000 per institution (raised from £85,000 on 1 December 2025) — offshore bank deposits are protected by the compensation scheme of the relevant offshore jurisdiction, where one exists.

Isle of Man: The Isle of Man Depositors' Compensation Scheme covers deposits up to £50,000 per eligible depositor per institution.

Guernsey: The Banking Deposit Compensation Scheme covers up to £50,000 per depositor per institution.

Jersey: The Banking Depositor Compensation Scheme covers up to £50,000.

Cyprus: EU Deposit Guarantee Schemes Directive coverage up to €100,000 per depositor per bank.

For deposits above the applicable compensation scheme limit, the investor is an unsecured creditor of the bank for the excess amount. Investors depositing significantly more than the protection threshold should assess the financial strength and credit ratings of the bank independently. Concentration risk — holding all cash at a single institution — should be considered for large deposits.

Tax Treatment

Interest earned on fixed term deposits is typically taxable as income in the investor's country of tax residence. The applicable tax rate depends on the individual's country of residence, tax status, and the tax treaty (if any) between their country of residence and the UK. The offshore bank will withhold tax only if required by the laws of its jurisdiction and applicable treaties — in most cases, interest is paid gross, with the investor responsible for declaring and paying tax in their jurisdiction of residence.

UK resident investors should be aware that interest on offshore deposits forms part of their UK taxable income and should be declared on their self-assessment return. Non-UK resident investors should seek advice in their jurisdiction of residence.

Suitability

This deposit is suitable for investors who: are seeking capital preservation with a modest positive real return; have a minimum 6-month investment horizon and no need to access funds during the term; are comfortable with GBP currency denomination; and understand the depositor protection arrangements applicable to the chosen institution.

This deposit is not suitable for investors who: require access to their capital during the 6-month term (early withdrawal is not available); are seeking growth or income substantially above current market rates; or require protection for amounts materially exceeding the applicable compensation scheme limits without independently assessing the creditworthiness of the institution.

How to Invest via Global Investments

Contact our team to confirm current rates, the specific bank, jurisdiction, deposit protection details, account documentation requirements, and the account opening process. We work with a panel of offshore banking partners and can identify the most appropriate institution for your currency, jurisdiction, and deposit size requirements.

Note: Deposit rates are indicative and subject to confirmation at time of application. Rates may change prior to formal acceptance. Capital is at risk in the event of bank insolvency in excess of applicable compensation scheme limits. Always verify current depositor protection limits in the bank's jurisdiction of licensing.