Collective Redemption Bond- currently up to 6.60% Gross on all Deposits

Through the Royal Skandia Collective Redemption Bond you can invest your money into a range of offshore building society and bank accounts which pay a competitive rate of interest, with no tax deducted.

The Collective Redemption Bond allows you to hold all your assets in one portfolio without any unwanted life insurance costs being added. You can choose from thousands of different kinds of investments, including offshore bank and building society accounts and you can switch your holdings between investments within the Bond simply at any time. If you wish, you can add to your portfolio, or cash in all or part of it when you want. You also have the facility to take a tax efficient income from the fund.

Your savings are invested in leading Isle of Man, Jersey and Guernsey banks and building society accounts, so you know your money is safe.

How much does it cost?
You pay an initial broker administration fee for the Bond of up to 1% of your deposit in year 1, which we will discount. Thereafter, you pay an annual management fee of 0.25%, which is deducted quarterly in arrears while the Bond is in force and there is a quarterly administration charge of £96, both of which are paid to Royal Skandia.

How much will I earn?
Here are some examples of accounts you can invest in through the Collective Redemption Bond. You can invest in all the major offshore UK banks and building societies.

Balances up to £50,000
Anglo Irish Bank Isle of Man 90 Day Notice 6.60% Gross/AER*

Skipton Guernsey Sterling Island 90 6.25% Gross/AER*

Balances up to £100,000
Anglo Irish Bank Isle of Man 90 Day Notice 6.60% Gross/AER*

Skipton Guernsey Sterling Island 90 6.25% Gross/AER*

Balances up to £250,000
Anglo Irish 90 Day Notice 6.60% Gross/AER*

Skipton Guernsey Sterling Island 90 6.50% Gross/AER*

Balances up to £500,000
Anglo Irish 90 Day Notice 6.60% Gross/AER*
Skipton Guernsey Sterling Island 90 6.50% Gross/AER*

Balances over £500,000
Anglo Irish 90 Day Notice 6.60% Gross/AER*

Skipton Guernsey Sterling Island 90 6.50 Gross/AER*

*Annual Equivalent Rate. Illustrates what the rate would be, if it were paid and added each year.

How safe is my money?
Your savings are invested by Royal Skandia in leading offshore banks and building society accounts in the well respected offshore centres of the Isle of Man, Jersey or Guernsey, so you can be confident your savings are in a well regulated jurisdiction.

Your bond is administered by Royal Skandia, part of the Skandia Group, which is owned by Old Mutual plc. Old Mutual plc is an international savings and wealth management company based in the UK with offices in over 40 countries. In the year ended 31 December 2006, the group had £239 billion of funds under management. The Company has 53,000 employees.

Together we will choose which organisation you wish to have your funds with.

Alternatively, we can send you full details in the post to enable you to take the decision yourself.

How do I access my Offshore Savings?

You can access your funds at any time, subject to the terms of the underlying deposit account.

How is this better than an Offshore Building Society Account?

If you leave your funds in place, interest rolls up on a gross basis.

Do you live in the EU Area?

If you live in the European Union area and you currently use an offshore savings account, you need to look closely at our new Offshore Savings Bond. That’s because from 1 July 2005 the new EU Savings Directive requires all offshore banks and building societies to levy a 15% tax on your savings, unless you can prove EU taxation has been accounted for.

What is the Tax Position?

If you are a UK tax payer, you can access up to 5% of the original investment on a tax free basis each year for 20 years. If you do not use this allowance, it is carried forward to the next year.
If you need to withdraw more, you can do this without penalty (subject to the terms of the account you choose), but there may be a taxation liability based only on the sum withdrawn.

However, each year you leave your funds in place, interest rolls up without deduction of tax, so the longer you can leave funds in place the better the growth potential.
Levels, bases and reliefs from tax are subject to change.

Risk Factors

If you take cash withdrawals within a defined period of making a payment, you may incur charges. However, you can withdraw a certain amount each year without an early withdrawal charge.

Depending upon the charging structure chosen, surrender penalties may apply if you take money out soon after paying premium.

This product should be considered as a medium to long term investment which you would hold for 5 years or more. You may get back less than you invested.

How to Apply

Please complete our enquiry Form if you would like us to send you literature about this product. If you would then like to learn more and invest in the product, we will offer you our fully advised service and recommend a suitable investment.

Alternatively, you can select the investment yourself and ask us to set this up for you.

Minimum investment: £25,000

This product should be considered as a medium to long term investment. You may get back less than you invested.