Corporate Savings & Investment Bond

Corporate money should work for you and holding your company’s money on deposit may make sense to meet short term cash flow requirements, however, holding all your surplus cash in deposit can be inefficient and may have a negative impact on your balance sheet as deposit interest rates are at historic lows and inflation is eating into your money. There may also be a tax implication via the Close Company Surcharge rule. Where a close company is in receipt of passive income e.g. rents, dividends and this income is not distributed to its shareholders within 18 months of the accounting period end in which the income arises, a close company surcharge will apply. The surcharge equates to an additional 20% tax on the post-tax undistributed passive income. Investment of Corporate funds in a savings structure allows you to avoid this charge.