Caught short by closure of Danske Bank accounts

Have you any further information about Danske Bank, as their internet banking facility seems to be restricted? I have maintained a current account with them and their predecessor bank for many years into which my income was paid and out of which some standing orders were mandated.

While I knew that they were proposing to shut up shop in Ireland, they had notified me earlier in the year that they would give two months’ notice of the closure of active current accounts.

As I would need to travel to Ireland in person to open an account with another bank, I was awaiting that notice before settling on a convenient travel date.

However, it seems that they have closed the account without reference to me, and both my income and liabilities have been thrown into confusion.

I have written to them as I have no other means available at this stage of contacting them, but have received no reply.

Possibly the problem only affects ex-pats, but I wondered whether you could shed any light on things? It is unlikely that I am the only one affected.

Mr S.O’S., Prague

You certainly seem to have been caught out by the winding down of Danske’s personal banking business in Ireland.

As you say, the bank did notify people that it was closing down their accounts and indicated it would give plenty of notice before acting on individual accounts – not least because it has been implementing the programme on a phased basis over recent months.

It says it will have “communicated directly” with all customers by letter “outlining their termination date and the steps to be taken to close their accounts”. “The majority, but not all” received a second letter, it says.

Having inquired following your query, I am now told it expects to conclude the exercise in June. However, the majority have already been closed or will be this month.

Whether you received any letter probably depends on whether the bank had a current address for you at the time, here or abroad. In any case, it’s somewhat academic. Your account has clearly already been closed.

The bank is operating a helpline for people looking to sort out issued with the process.

It operates from 8am-8pm on weekdays and 9am-4pm at weekends, on 1890 866 866 (from within Ireland) or +353 1 484 3752 (from outside Ireland).

There is also an email service through its online banking service – you should still be able to access the website even if the account has been closed.

You need to act quickly because, for now, you will have no access to your funds – although they are held for you, pending your instructions.

Just as importantly, any direct debits or standing orders on which you rely to pay bills are not being paid.

You can get your funds released or transferred by calling the bank, but it will still take a number of days to receive your money. And you will likely have to deal directly with anyone scheduled to receive direct debits or standing orders.

If you do need to come home to sort out alternative banking arrangements, I suggest you do so now.

Alternatively, you might see whether a bank local to you can provide the services you need, bearing in mind that payments from your Irish account were presumably mostly for local suppliers and this might present some problems with an account in a European bank.

The current introduction of SEPA – the Single European Payment Authority – will presumably facilitate this across the EU, but it is really only getting up and running at the moment and might not serve you in this regard just yet.

Cutting tax on long-held shares

In 1990, I was left 1,000 shares in a will.They were valued at the equivalent of €1 each.They are now valued at €10.What would be my capital gains liability now if I sold them? I know there was a table of inflation/indexation multipliers which ceased in 2004, but how would I use this to reduce capital gains?

Mr B.H., email

Back then the tax year ran from April 1st to March 31st. The importance of that, from your perspective, is that the inflation multipliers were tied to tax years so the figure will be different depending on whether you received the shares in the first quarter 1990, or after April 1st.

For clarity, in general, the date of death will generally be taken as the date of transfer, although you may well not have received effective control of the shares until some time later.

You say you received 1,000 shares valued at that time at the equivalent of €1. If the transfer occurred before March 31st of the year, the multiplier would indicate that your effective inflation-adjusted “acquisition” price was €1.503 each, or €1,503 in total.

If the transfer happened on or after April 1st, it would be €1.442 a share, or €1,442 in total.

Given that they are now worth €10 each, you say, you have made a capital gain of either €8.558 or €8.497 per share – or €8,558/€8,497 in total.

You are entitled to deduct costs involved in the acquisition or sale of the stock before calculating capital gains – in your case this will be the cost of selling the shares.

Also, there is a capital gains tax exemption of €1,270 in any given year before liability to capital gains tax kicks in.

And no, you cannot avail of this in years when you did not trade assets – it does not roll over.

It is also worth noting that if you have accrued losses on other share dealings that have not since been offset against other gains, these must be use up before assessing capital gains (or availing of the annual exemption).

The capital gains tax rate is currently 33 per cent.

If you have no losses and were to sell all your shares this year, you would face a tax bill of €2,384.91 or €2,405.04.

Of course, you could spread your sales over a number of years to maximise the benefit of the annual CGT exemption.

Please send your queries to Dominic Coyle, Q&A, The Irish Times, 24-28 Tara St reet, D ublin 2, or e mail to dcoyle@irishtimes.ie. This column is a reader service and is not intended to replace professional advice.