Photo of Coins and notes

Finances

Money

The national currency is the British pound (sterling) (£), with one hundred pence to each pound. Notes are issued in the value of £50, £20, £10 and £5, and coins to the value of £2, £1, 50p, 20p, 10p, 5p, 2p, and 1p. Value Added Tax (VAT) is a 20% tax which is payable on most retail purchases.  All major credit cards and charge cards are widely accepted for goods and services.  There are no currency controls and visitors to, or residents of the UK can freely transfer all currency provided that this does not contravene the regulations of the country to which the money is being transferred.  Check with your bank at home the best way to transfer money to the UK to save you bringing significant amounts of cash with you.  Customs Officers may question you if you bring a large amount of cash with you.

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Setting up a bank account

There are around 20 major commercial banks in the UK, many of which also have branches overseas. The four largest are Lloyds TSB, Barclays, NatWest, and HSBC. Other institutions including the Post Office, various savings banks, and cooperative and building societies also provide banking services. Most banks provide a range of additional services and many offer telephone and Internet and banking facilities.

There are cash machines (“ATMs”) located at most banks.  If you intend to keep your existing bank account you may want to check that you will be able to withdraw cash from UK ATMs. Bank opening hours are generally from 9:30 to 16:30 on weekdays. They are closed on public holidays and at weekends. In order to open an account, non-UK nationals may be asked to show their passport, evidence of their UK address and employment details.  The British Bankers’ Association have published a leaflet entitled “Opening a bank account if you are new or returning to the UK” and this is available athttp://www.bba.org.uk/content/1/c4/39/71/Openingbankaccountleaflet2004.pdf.

You will need to make an informed decision when choosing a bank and the type of account you wish to open.  Charges for both agreed and unauthorised borrowing can be high, so be sure to be aware of what fees and interest rates are involved.

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Credit Unions

Credit Unions are local financial co-operatives owned and controlled by their members.  They offer savings and good value loans, even if you do not have a bank account. You can start saving with as little as £1.  Each Credit Union has a "common bond" which determines who can join it. The common bond may be for people living or working in the same area, people working for the same employer or people who belong to the same association, such as a church or trade union.  As with banks, you will usually need to produce two forms of identification to open an account.  There is one credit union in Herefordshire, which is based in Hereford and can be found at http://www.moneyboxcu.org.uk/.

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Sending Money Home

There are several methods of sending money to other countries.  It is not recommended that you send money through the post. There may be charges for transferring money and you will need to verify this with the service you decide to use.  Your bank may be able to transfer money for you, the Post Office offers a “Money Gram” system and there are many commercial companies specialising in the transferring of funds abroad.  Always do your research and if possible seek personal recommendations.

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Financial Difficulties

If you find yourself in financial difficulties it is important to prioritise your bills and seek help as soon as possible.  In Herefordshire, the Citizens Advice Bureau provides confidential help and support, free of charge.  There is also an informative website to help people who are in debt:http://www.adviceguide.org.uk/index/your_money/money_management_index_ew.htm

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Direct Debits

A Direct Debit is an instruction from a customer to their bank or building society authorising an organisation to collect varying amounts from their account, as long as the customer has been given advance notice of the collection amounts and dates.  Many bills can be paid this way. More information can be found at:http://www.thesmartwaytopay.co.uk/DirectDebitHelpCentre/Pages/DirectDebitHelpCentre.aspx

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Tipping

Tipping in the UK is usual for some services. Most hotels and some restaurants include a service charge of around 10-12% of the bill, but if it’s not included, this is a guide of how much you might want to leave as a tip. Similarly, it is usual to tip taxi drivers around 10% of the fare. It is usual also to tip hairdressers.  But remember that you are not obliged to leave a tip, even if it is included in the bill, so only tip when you have received good service.

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