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European Union Savings Directive

The European Union Savings Directive (EUSD) is an agreement between the Member States of the European Union (EU) to exchange information about customers who earn savings income in one EU Member State but live in another. Some non-EU countries and jurisdictions have voluntarily put into place the same or equivalent measures - these include Jersey, Guernsey, Gibraltar and the Isle of Man.

From 1 January 2015 there will be important changes to the way accounts held in Jersey are affected by the European Union Savings Directive. Please see the Jersey section below for more details.

There will be no changes to the other jurisdictions (Guernsey, Isle of Man and Gibraltar).

Does the directive affect me?

If you are resident in an EU Member State and earn savings income on deposits or investments held in your own name, it is likely that you will be affected by the directive. The directive does not apply to anyone who lives outside the EU.

Savings income is defined by the directive as:

  • interest earned on bank deposits, such as savings accounts
  • interest from certain bonds and proceeds on their sale or redemption
  • income from certain types of investment funds

Any accounts that pay credit interest are affected. Under current guidance, the returns generated by our structured deposit products should not be affected. However, please note that it is still your responsibility to declare any relevant returns to your local tax authority.

Most other types of income, i.e. dividends on ordinary or preference shares of companies, salary and pension payments, fall outside the definition and so are outside the scope of the directive.

What is changing on 1 January 2015?

Jersey has decided to remove the Retention Tax option in favour of exchanging information with the local tax authority. Please see the Jersey section below for more details.

There will be no changes for Isle of Man, Guernsey and Gibraltar customers (see sections below for detailed information on these jurisdictions).

Please review the guidance for the different jurisdictions noting that structured deposit and Structured Deposit Cash Management accounts may be held in the Isle of Man.

Gibraltar

Information for customers with accounts held in Gibraltar.

For new customers

In order to open an account after 1 July 2011 customers are asked to agree, within the terms and conditions of business, to the exchange of certain information with the local Gibraltar tax authority.

Any savings interest will be paid to you without the deduction of Retention Tax and we send the local tax authority information regarding your identity and residence, the amount of savings income earned and the period it relates to. This information is then forwarded to the tax authority of the country where you are resident.

This information is collated and submitted annually for the period 1 July to 30 June.

Please note that it is your responsibility to declare any relevant returns to your local tax authority.

Existing customers that live in the UK

On 1 July 2011, the rate of retention tax charged under the European Union Savings Directive increased from 20% to 35%. You don’t need to take any action as the changes will take place automatically.

As an alternative to paying Retention Tax, you may wish to consider allowing us to exchange information about you with the Gibraltar Government. If you choose this option we will pay interest gross then exchange information about your identity and residence, savings interest earned and the period this relates to. This will then be shared with the tax authority of the country where you are resident.

This information is collated and submitted annually for the period 1 July to 30 June.

If you wish to exchange information we will need you to authorise us to do so in writing. Please download and complete the election form for exchange of information (PDF, 79KB) or, alternatively, contact us and we can send you one to complete and return.

Please note that it is your responsibility to declare any relevant returns to your local tax authority

Existing customers that live in other EU countries

There is no change to the directive.

Guernsey

Information for customers with accounts held in Guernsey.

On 1 July 2011, the Guernsey Government withdrew the option for customers to pay Retention Tax on savings income. Therefore, we will be required to provide information on all EU resident customers who earn savings income on deposits or investments.

Any savings interest will be paid to you without the deduction of Retention Tax and we will send the local Guernsey tax authority information regarding your identity and residence, the amount of savings income earned and the period it relates to. This information is then forwarded to the tax authority of the country where you are resident.

This information is collated and submitted annually for the calendar year, 1 January to 31 December.

Please note that it is your responsibility to declare any relevant returns to your local tax authority.

EUSD exemption certificate

If you provided a formal EUSD exemption certificate from your home tax authority before 1 July 2011, you should be exempt from information exchange.

If you were unable to provide a certificate before 1 July 2011 then we will automatically provide interest information to the Guernsey Government. If you provide one after this date we will update our records as quickly as possible but if you have been paid credit interest in between these points this information will be exchanged.

Isle of Man

Information for customers with accounts held in Isle of Man.

On 1 July 2011, the Government of the Isle of Man withdrew the option for customers to pay Retention Tax on savings income or claim exemption from EUSD. Therefore, we are required to provide information on all EU resident customers who earn savings income on deposits or investments.

Any savings interest will be paid to you without the deduction of Retention Tax and we will send the local Isle of Man tax authority information regarding your identity and residence, the amount of savings income earned and the period it relates to. This information is then forwarded to the tax authority of the country where you are resident.

This information is collated and submitted annually for the period from 6 April to 5 April the following year.

Please note that it is your responsibility to declare any relevant returns to your local tax authority.

Jersey

Information for customers with accounts held in Jersey.

From 1 January 2015, the Jersey Government will withdraw the option for customers to pay Retention Tax on savings income. Therefore, we will be required to provide information on all EU resident customers who earn savings income on deposits or investments.

Any savings interest will be paid to customers without the deduction of Retention Tax and we will send the local Jersey tax authority information regarding their identity and residence, the amount of savings income earned and the period it relates to. This information is then forwarded to the tax authority of the country where customers are resident.

This information is collated and submitted annually for the calendar year, 1 January to 31 December.

Please note that it is the customer’s responsibility to declare any relevant returns to their local tax authority.

Prior to 1 January 2015

For new customers

In order to open an account after 1 July 2011 customers are asked to agree, within the terms and conditions of business, to the exchange of certain information with the local Jersey tax authority.

Any savings interest will be paid to you without the deduction of Retention Tax and we will send the local tax authority information regarding your identity and residence, the amount of savings income earned and the period it relates to. This information is then forwarded to the tax authority of the country where you are resident.

This information is collated and submitted annually for the calendar year, 1 January to 31 December.

Certain customers may be able to claim exemption from EUSD. In order to do this you will need to provide us with a certified copy of a formal EUSD exemption certificate from your home tax authority.

Please note that it is your responsibility to declare any relevant returns to your local tax authority.

Existing customers

On 1 July 2011, the rate of retention tax charged under the European Union Savings Directive increased from 20% to 35%. You don’t need to take any action as the changes will take place automatically.

As an alternative to paying Retention Tax, you may wish to consider allowing us to exchange information about you with the Jersey Government. If you choose this option we will pay interest gross then exchange information about your identity and residence, savings interest earned and the period this relates to. This will then be shared with the tax authority of the country where you are resident.

This information is collated and submitted annually for the calendar year, 1 January to 31 December.

If you wish to exchange information we will need you to authorise us to do so in writing. Please download and complete the election form for exchange of information (PDF, 79KB) or, alternatively, contact us and we can send you one to complete and return.

Please note that it is your responsibility to declare any relevant returns to your local tax authority.

The directive covers all EU Member States. The jurisdictions which have voluntarily agreed to apply the same or equivalent measures are the UK Crown Dependencies and UK Overseas Territories, the Dependent Territories of the Netherlands, and some other ‘Third Countries’.

EU Member States Other Countries,
Dependencies and
Territories
Austria Andorra
Belgium Anguilla
Bulgaria Aruba
Croatia British Virgin Islands
Czech Republic Cayman Islands
Denmark Curacao
Estonia Guernsey
Finland Isle of Man
France Jersey
Germany Liechtenstein
Greece Monaco
Hungary Montserrat
Ireland San Marino
Italy St Martin
Latvia Switzerland
Lithuania Turk and Caicos Islands
Luxembourg
Malta
Netherlands
Poland
Portugal
Republic of Cyprus
Romania
Slovakia
Slovenia
Spain
Sweden
UK

What is the European Union Savings Directive?

It is an agreement between the Member States of the European Union (EU) to exchange information about customers who earn savings income in one EU Member State but live in another.

Some jurisdictions have voluntarily put into place the same or equivalent measures. These include Jersey, Guernsey, Gibraltar and the Isle of Man. In some circumstances retention tax may be allowable.

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What is ‘savings income’?

Savings income as defined by the directive means:

  • interest earned on bank deposits, such as savings accounts
  • interest from certain bonds and proceeds on their sale or redemption
  • income from certain types of investment funds

Most other types of income - for example, dividends on ordinary or preference shares of companies, salary and pension payments - fall outside the definition and so are outside the scope of the directive.

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Are all of my accounts affected by the directive?

Any accounts that pay credit interest will be affected - for example savings accounts and fixed-term deposits. Under current guidance, structured deposit accounts should not be affected unless they have a fixed deposit element. Please note that structured deposit and Structured Deposit Cash Management accounts may be held in the Isle of Man.

It is still your responsibility to declare any relevant returns to your local tax authority.

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What is exchange of information and how will it work?

For individuals with accounts in the jurisdictions we send our local tax authority information about your identity and residence, the amount of savings income earned and the period it relates to. This information is then forwarded to the tax authority of the country where you are resident and may be compared by them with your tax returns.

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How does this fit with the data protection legislation and customer confidentiality?

All the jurisdictions have comprehensive data protection legislation and well-established common-law principles on customer confidentiality. As laid out in our Terms and Conditions we only divulge information regarding your account where required to do so by law or with your specific authority.

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How will the interest earned on joint accounts be treated?

Interest earned on accounts held in two or more different names will be treated on the basis that it has been earned equally among the account holders. Additionally, individual residency status will also be applied so only those accounts holders who are EU residents will be subject to information exchange

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Are companies affected by the directive?

The directive only applies to payments of savings income to individuals and certain other special types of organisation. Legal entities, including companies, and certain other entities (for example Partnerships and certain Trusts) are not affected by the directive.

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When did the directive come into effect?

The directive came into force on 1 July 2005 and has been amended in 2008 and 2011.

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Latest guide

Download the latest version of our EU Savings Directive guide, updated 1 July 2011.


Election forms

Please review the guidance for your jurisdiction prior to completing an election form.


Historic guides

For further information on the savings directive prior to 1 July 2011, please refer to our historic guides.