As this product is tax free, would the comparable rate not be higher when compared to other taxable products ?
If you are self employed, you would save 41% plus levies 5%, therfore the 3.75% should be grossed up to give a gross rate of 6.9%.
Would this be correct ?
No - if you earned 3.75% net from an account subject to DIRT then the equivalent gross rate before DIRT would be (3.75 / 8) * 10 = 4.6875%. The tax advantage of the An Post accounts don't make up for the fact that compared to other deposit products on the market the rate payable is poor. Obviously the An Post rate is fixed and most other deposit rates are variable but I still don't think that An Post offer a good deal and have not done so for many years now.As this product is tax free, would the comparable rate not be higher when compared to other taxable products ?
If you are self employed, you would save 41% plus levies 5%, therfore the 3.75% should be grossed up to give a gross rate of 6.9%.
Would this be correct ?
I thought deposit interest was taxed at you marginal rate, be it 41% or 20% and then you get credit for any DIRT deducted ?
Not so. See here:
[broken link removed]
"The payment of retention tax at the standard rate by individuals liable to income tax at the higher rate is regarded as satisfying the individuals' full liability to tax."
Depends on which class of CU account(s) you have. See [broken link removed].except if its the credit union, even though they now deduct tax at source.