Must I declare interest on post office savings?
I have €10,000 in Post Office three-year bonds, the fruits of 50 years’ savings. I know the interest should be declared (as it is on our joint ones) but is there any way my much-loved husband could be kept in the dark about it?
Ms A.R., Laois
I assume that you and your husband are jointly assessed for tax. That creates an issue for you in that any return relates to your joint assets.
The first thing to note is that An Post savings are tax free. It is one of the major attractions of saving with the post office and explains why the headline rate of interest can appear lower than competing products. When you factor in Deposit Interest Retention Tax , currently levied at 33 per cent, on similar types of products elsewhere, the An Post rate comes into its own.
The only time the interest on An Post savings is relevant to tax authorities is in assessing if you qualify for the old age exemption threshold on income. For a married couple over the age of 65, that figure is €36,000: for a single person, it’s €18,000.
If the interest on your savings would bring the family income above €36,000, it is relevant to how Revenue will assess you and your husband for income tax. If your income is below that threshold then there is no need for concern.
Despite your close relationship, the nature of family life in Ireland until recently meant that women, in particular, often had no independent means – this has been a critical line of argument in the debate about universal child benefit. Wanting to have that independence in no way undermines your relationship but disclosing that you have a five-figure sum saved of which your husband is unaware could lead to certain tensions in itself.
Unfortunately, if the amount of interest involved would negate your entitlement to an income exemption, then you have an obligation to disclose it to Revenue – the onus is on the taxpayer(s) to be proactive in disclosing relevant income and assets. It is only the amount earned in interest that needs to be declared, not the amount of the overall savings.
If you must declare the interest and if you are jointly assessed, there is no way to make the declaration other than on your joint tax return and that is open to view by your husband. I cannot see any way, in those circumstances, where you can ensure your husband is kept in the dark.
If the amount would have no bearing on the issue, there is no compunction to declare and no requirement to let your husband know of your savings.
EBS/AIB retain protection on savings
I have had deposit accounts at both AIB and EBS for a number of years. Recently EBS was absorbed into the AIB group. When they were separate banks my deposits were considered as being in two separate banks. Does the deposit guarantee scheme consider these two to be one bank or are they still under separate guarantees?
Mr J.H., email
The decision to merge the two institutions will not affect your protections. I checked with the Revenue and it confirmed that, although merged, AIB and the EBS are treated as separate institutions for the purposes of the deposit protection guarantee.
So you can hold up to €100,000 in both institutions and retain the protection of the deposit protection guarantee. Note that is €100,000 in each institution not in each account in either place. If you have two EBS accounts – one with €70,000 and the other with €50,000 – and an AIB account with €70,000, the AIB money will be fully covered but only €100,000 of the €120,000 in the EBS will be protected. The protection is on the aggregate amount in each institution not the aggregate amount between them. T hus, although your total savings in the two banks is €190,000, you would need to transfer some of the EBS money into AIB to ensure it is all protected.
easiest way to sell shares?
I am going to have to sell one or two inherited shareholdings. What is the most efficient way of doing this, seeing as there is no prospect of me making share purchases in the future and therefore have no need of a permanent dealing account?
Mr J.G., Dublin
You need an “execution only” service from a stockbroker. Most brokers offer such an option where they effectively sell the shares on your behalf without giving advice. My advice is to ring around the brokers, find the most competitive pric e and choose accordingly. Most will charge a percentage of the transaction sum, with a minimum charge. I assume you have paper share certificates. You’ll need to get the cert to the broker before the deal is executed.
This column is a reader service and is not intended to replace professional advice. Please send your questions to Q&A, c/o Dominic Coyle, The Irish Times, 24-28 Tara St , D 2, or to firstname.lastname@example.org.