The interest rates available on personal deposit accounts are much higher than those for business deposit accounts. Can I withdraw money from my company’s account and deposit it in an account in my name, on the understanding that I hold the funds as an agent for the company? All the interest would be declared as the company’s income rather than my own.
The Taxman accepts this plan works if there is a trust deed in place which gives the company a legal right to the funds. However, will you be completely open with the bank when opening the deposit account in your name? If you declare you hold the funds as agent for the company you may not get the higher interest rate you seek, as the bank will view the account as a commercial rather than a private account.
