I am aware that the protection for individuals losing their savings due to a bank failing are £35,000.
What amount is protected for a Limited Company having savings at a bank that fails?
Deposit Protection for Companies
Sep 25, 2008
6 Replies
I dont' know the answer to that, but I know the answer to a related question.
I am buying a house and I asked my solficitor how I was protected if his bank went bust while my money was sitting in his client account there
He did not know so he found out. These was no protection, not even the 35k.
Robert
Exactly this question recently came up on the BBC's Working Lunch programme a few days ago.
The answer is that if the company is defined as Small, in accordance with the EU definition of a Small Company, then yes, such Small Enterprise has exactly the same protection as an individual.
Definition of a Small Enterprise? Well not really that small, and the majority of enterprises will probably fall within the definition :-
A small enterprise has an employee headcount of less than 50, and a turnover or balance sheet total of not more than ?10 million.
In fact only 2 or those 3 tests need to be met, and the enterprise is still defined as small.
If a Limited Company has no more protection than an individual that is a ridiculous state of affairs. I think it's fair to assume that a profitable company is likely to acrue more savings than an individual and a £35,000 cap is negligible.
same as for a person - on small business accounts.
If you want real safety the answer is a Bank or Building Society savings account, current account, small business account (with annual turnovers below £1 million) or credit union, but not savings stamps or hamper schemes. Specifically this is any UK registered bank (see later for how this impacts foreign banks UK subsidiaries).
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But obviously one account only per bank
see the list of which banks are sep too.
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FAQ no 11 says you are covered. I'm not sure if that is £35,000 per client account. Even a small conveyancing solicitor can easily have millions in the client account.
I dont' know the answer to that, but I know the answer to a related question.
I am buying a house and I asked my solficitor how I was protected if his bank went bust while my money was sitting in his client account there
He did not know so he found out. These was no protection, not even the 35k.
Not really correct because his insurers will pay.
Peter Crosland
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