Updated the message, thanks.The rates for the Standard (Free) Plan are:
EUR: 3.51% (1.86% net)
USD: 4.70% (2.42% net)
GPB: 4.67% (2.46% net)
It's an investment (With Fidelity in a Money Market Fund) so withholding tax of 41% applies.Spotted this yesterday too. Why 41% tax if DIRT is 33%?
Correct. Did the current minister for finance suggest some time back that he intends to revisit this in the future?Because the money is invested in a fund, not on deposit - earnings on funds are taxed at the Exit Tax rate, currently 41%
DIRT = Deposit Interest Retention Tax 33%
The two used to be the same back in 2014 - 2016, but DIRT has reduced from 41% to 39% to 37% to 35% to 33% over the years whilst Exit Tax remained at 41%
Hi Lightening- The service fee is very large. I see a service fee of 0.50%. That is a very big fee. (Not sure where the prior poster sees 12%?)
The KID describes the investment product and fees and charges deducted by the investment product provider.
The service charge is a a charge levied by Revolut and has nothing to do with the investment product per se.
All in all it’s an excellent example of how appallingly lacking in transparency the financial services industry is in when it comes to fees, charges, commissions etc. It’s really very difficult to understand how much is being creamed off, especially when intermediaries are involved.Thanks. What a convoluted process where the fund has "zero fees" (as per the KID) but Revolut charge high "service fees" (and indirect subscription fees) and Revolut kick back some of the "service fee" to Fidelity. Would be a lot simpler/more transparent if there was no service fees and the fund itself applied a TER/fee as per the normal process.
@Flying Dutchman :
- Interesting thoughts and calculations.
- Lightyear is 33% tax.
- I think this product is best compared to other MMF products (XEON, CSH2, Plum etc) rather than comparing to savings products.
- Any clue why exit tax is applied to the gross interest rather than the return after fees??? Exit tax is charged on gains. Gains surely means after fees.
@Freelance:
- Yeah, the fees and charges could be clearer.
- But displaying the fees as "0.50%" is the normal way to display a TER/fee of a fund. Displaying fees as "12.5%" is not the normal way. For example, CSH2 pays aprox. 3.90% and has a TER of 0.07% and therefore an aprox net return of 3.83%.
- I find is surprising that the KID (Key Investor Document) makes no reference to the direct fees (service charge) and no reference to the indirect fees (Revolut subscription package fees which are mandatory to get the higher rates).
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