The EU Savings Tax Directive and possible solutions
Simplistically, the European Savings Tax Directive (EUSD) is an agreement to automatically withhold and exchange information about individuals whose savings income is earned in one nation but who reside in another. The EUSD is now law in all EU member states, dependent territories and several additional nations known as 'third countries' meaning that if you have funds in a bank account outside of your country of residence, then the days of keeping this secret and not having to pay tax on the income are gone.
Automatic exchange of information is the ultimate objective of the EUSD, but certain member states have instead adopted a policy of automatically withholding tax. The level of tax withheld on a customer's account started at 15% in 2005, by July 2008 this has risen to 20% and by 2011 the tax automatically withheld will be a massive 35%.
The directive took over 15 years to agree but happily there are solutions.
Your first step is to speak to one of our specialist advisers to ascertain what can be done to minimize the effect of the EU Savings Directive on your finances.
We can provide you free, country specific tax fact sheets in order to assist you with your planning. To ensure that the information that you are seeking is relevant and that you are fully aware of all the advantages and country specific benefits of your expatriate status, please contact us today and we will be happy to have an adviser call you to discuss your options.
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