Will Government take deposits?

[Sunny]

It's the new Health Levy

As regards worrying about deposits being targeted as a result of the pension levy... has no-one heard of DIRT?

DIRT is a tax on interest. The levy is a tax on the capital. Totally different.

 

[JoeB]

... I just wonder that in the event of a disengagement from the euro, is it possible that, as part of an agreed exit strategy, the offshore deposits of Irish residents in eurozone countries might be repatriated? How likely is such a scenario?

I'd have thought not likely. It's clear discrimination based on race, or nationality.

An Irish person who's lived in Germany for years would be unhappy that his german account is to be 'taken', whereas his german friends get off scot free. There'd also be dual nationality issues.


But now that the doubt is out there I suppose everyone will be moving accounts out of Europe!


Foreign banks will likely always say that they will comply with 'lawful' orders. So if the Irish government stated that your money in foreign accounts was the proceeds of crime then yes, the foreign banks will likely freeze the accounts.

If the Irish government made it illegal for irish people to open foreign bank accounts would the foreign banks comply with that 'lawful' order?, if the order was that all money held by people who used Irish ID to open an account should be sent back to ireland.

Some companies give strong guarantees. My example here is BullionVault, a gold seller... they claim that they will fight your case in the UK courts if a foreign government attempts to make gold ownership illegal for private citizens in your home country. I believe them when they say that. (It's in their T&Cs). As a company they made over 35 million profit one year, with less than ten employees. They also keep enough funds on deposit to run their company for three years. So they bend over backwards to allay fears.

 

[callybags]

DIRT is a tax on interest. The levy is a tax on the capital. Totally different.

I don't think it is different.

As soon as interest is paid on a deposit account, it becomes capital. It is then taxed.

As soon as you get paid at the end of the month, it is your money and your asset. It is then taxed.

 

[JoeB]

Not true. Income is taxed at source, through the PAYE system. But it's income first, you pay tax, then it's savings.. you shouldn't have to pay again if you choose not to spend the savings..

Interest is taxed at source before payment.. again it's income, until taxed correctly, then it's savings. Again, you shouldn't have to pay more tax if you don't spend the money.

 

[Kev]

I'd have thought not likely. It's clear discrimination based on race, or nationality.

An Irish person who's lived in Germany for years would be unhappy that his german account is to be 'taken', whereas his german friends get off scot free. There'd also be dual nationality issues.

But now that the doubt is out there I suppose everyone will be moving accounts out of Europe!

Foreign banks will likely always say that they will comply with 'lawful' orders. So if the Irish government stated that your money in foreign accounts was the proceeds of crime then yes, the foreign banks will likely freeze the accounts.

If the Irish government made it illegal for irish people to open foreign bank accounts would the foreign banks comply with that 'lawful' order?, if the order was that all money held by people who used Irish ID to open an account should be sent back to ireland.

Some companies give strong guarantees. My example here is BullionVault, a gold seller... they claim that they will fight your case in the UK courts if a foreign government attempts to make gold ownership illegal for private citizens in your home country. I believe them when they say that. (It's in their T&Cs). As a company they made over 35 million profit one year, with less than ten employees. They also keep enough funds on deposit to run their company for three years. So they bend over backwards to allay fears.

What about people money in UK that was transferred and that would come under the UK jurdiction what would happen to their deposts.

Also what about people who have lived in UK for 50 years and retain their passport and have money in Irish bank in euros, would the irish government be able to take their deposits.

 

[bryanod]

Quick answer would be to base it on residence, so someone in the UK for 50 years would be a UK resident obviously, similarily someone in Germany for years would be a german resident, obviously, but someone resident in Ireland whom opened a foreign account would come under the same rules.

All ifs and buts and can't really happen, but don't think opening foreign (currency especially exposuring yourself to fx risks!) accounts will solve much.

 

[Kev]

The best option would be for depositors that have saving in Ireland in euro and residing in UK for 50 years and retaining their irish passport would be transfer their money to AIB in UK

 

[Gervan]

I know it's all theory and guesswork at this stage, but I can't see how the Irish government could tax an offshore bank. Ask them for information, yes.

The pension levy is being raised on the pension fund, not the individuals. So if a "deposit levy" was to follow the same lines, only deposits in Irish situated banks could be taxed.
Well, that's what I'm hoping anyway. And supposing the rich and powerful here have most of their funds abroad now, I think they would stick to taxing the bank, not the individual.
It would be very retroactive taxation, taxing savings that could have been acquired over a lifetime, but they've done that with the pension levy.

 

[Kev]

I know it's all theory and guesswork at this stage, but I can't see how the Irish government could tax an offshore bank. Ask them for information, yes.

The pension levy is being raised on the pension fund, not the individuals. So if a "deposit levy" was to follow the same lines, only deposits in Irish situated banks could be taxed.
Well, that's what I'm hoping anyway. And supposing the rich and powerful here have most of their funds abroad now, I think they would stick to taxing the bank, not the individual.
It would be very retroactive taxation, taxing savings that could have been acquired over a lifetime, but they've done that with the pension levy.

You can ask the bank, but would you get an correct answer, taxing the bank would that be the bondholder or depositors, as they both come under the same legislation.

 

[farmerette]

its quite clear that a very sizeable number of irish people have moved money out of the country , in the event of a default or even a euro exit , this would lead to a situation where those who had moved their savings abroad would find themselves in a very strong possition in terms of purchasing power due to a devaluation of the countrys new adopted currency , this could very possibley lead to a high degree of profiteering in terms of buying up property etc , this in turn could lead to a lot of social unrest , i wouldnt be surprised if the goverment took measures to prevent this happening , it therefore begs the question , are irish citizens who have bank accounts abroad guarenteed that thier money in sterling or even euro in the likes of the uk or germany , would be entirely safe from a currency devaluation , perhaps thier is no escaping the fallout if we do indeed default or leave the euro

just a thought

 

[barrydn]

What about keeping your money in cash? (safety and inflation aside)

 

[PolkaDot]

i it therefore begs the question , are irish citizens who have bank accounts abroad guarenteed that thier money in sterling or even euro in the likes of the uk or germany , would be entirely safe from a currency devaluation

Well there would obviously always be the risk of a general devaluation of the Sterling or the Euro.

But doesn't doing what you have mentioned above at least remove the risk of your savings being converted to a new Irish punt, or whatever might be used, which would likely to be significantly devalued?

 

[bryanod]

Well there would obviously always be the risk of a general devaluation of the Sterling or the Euro.

But doesn't doing what you have mentioned above at least remove the risk of your savings being converted to a new Irish punt, or whatever might be used, which would likely to be significantly devalued?

Yes it theoretically could do that, but there is the far more important, immediate and real risk of having your deposits in foreign currencies if you are looking at Sterling Funds. Already depositors have lost circa 3% this year alone, and it was far worse at one stage at nearly 5%.

not to mention if/when the crises is resolved, the Euro will be stronger again and your losses from Sterling could be greater.

 

[dam099]

The best option would be for depositors that have saving in Ireland in euro and residing in UK for 50 years and retaining their irish passport would be transfer their money to AIB in UK

Why bother with AIB GB? If moving money to the UK then there are many UK banks to choose from rather than a subsidiary of a very troubled Irish bank.

 

[Kev]

You could keep savings in euro also the interest rate would not be as low as it would be with a UK bank.

 

[JoeB]

duplicate post to here... http://www.askaboutmoney.com/showpost.php?p=1169179&postcount=10





I may have been unfair on Ulster bank. The term is..
(iv) The laws of Northern Ireland apply to the contract between you and us. The law which
we take as the basis for establishing relations with you prior to the conclusion of the
contract is the law of Northern Ireland. The courts of Northern Ireland shall have nonexclusive
jurisdiction over any disputes arising between you and us that are not resolved
by other means.

end term.

So the laws of N.I do apply, as stated in the first sentence. The second sentence also refers to laws of N.I.

The third sentence is seperate to the two previous, and qualifies the use of a non-NI court, 'in the event of a dispute not settled in another way'. So the courts of southern ireland could be used, if someone from the republic starts a case in the republic, and the judge agrees to accept jurisdiction. Ulster bank say that this is to benefit consumers, who might not want to travel to NI to a court case... so Ulster bank will agree to a case in another jurisdiction, if they have branches in that other jurisdiction. So perhaps Ireland, north and south, and the UK, but not Nigeria or North Korea.

But Nigeria and North Korea aren't ruled out, and the additional explanations given to me aren't actually in the terms.

But the terms do state clearly that 'the laws of NI apply... full stop'. So I'd be happy enough now actually with that. But a further clarification from Ulster bank, .. that they will only attend court cases in another jurisduiction if that case is instigated by the customer.. and that Ulster bank themselves will never begin proceedings in a different jurisdiction to NI.. that further clarification would be useful, and it isn't contained in the terms, but informally that's how they describe the terms. In court they might give a different intrepretation,.. which is why recording phone calls is so important. (The additional info was given to me in a phone call, and they probably expect that I haven't recorded it, I gave no indication of doing so, and intend the recording for 'private use' only, but nothing kinky)


So to be fair on Ulster Bank, .. I think they'r ok, but make up your own mind!

Cheers

 

[dam099]

You could keep savings in euro also the interest rate would not be as low as it would be with a UK bank.

You can have Euro accounts with Uk banks, a quick search of Barclays site for example shows they do one.

 

[dec1892]

So can a resident of the Republic open a euro account with a Barclays branch in Northern Ireland? Anyone else here having an experience of this?

 

[pilotsnipes]

Don't have much time but yes.

I opened one in Barclay's Newry. Needed to open the free STG current account too, but that was no big issue.

Few things to note.
Euro account is FREE per month.
It is accessible by TELEPHONE only, no internet access, no easy way to see the balance.
It is accessible by TELEPHONE only. Just want you to be clear on this.
Rates are non-existent, but for me I couldn't care less, 5% interest on an account here in ROI where the government might take some is far far worse.

There is a roughly 15-20STG( or was it euro) charge for money transfered OUT of the account to another EUROPE euro account.

Money transferred IN is free.

It's a good deal. Just bring the normal passport licence etc etc to the bank. Make an appointment first, otherwise you'll waste your trip.


(It's hard to find the account on the Barclays website - it is there though, it is NOT the business/international account, but a personal euro account for boyo's like us)

 

[coldcake]

Hi Pilotsnipes,

How did you make an appointment with the branch? Did you call the branch directly of did you have to call the call centre to arrange an appointment?

Thanks

Coldcake