Raisin Bank 1 Year Fixed Deposit Rate, Blu Or v BPL Bank

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Geralfie

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On Raisin bank website the rate of interest for a 1 year fixed deposit account in Blu Or Bank is 4.21% AER where as in Banca Privata Leasing(BPL) the rate is 3.9% AER. Reading the threads on here Blu Or appears to considered as the best rate. Blu Or Bank charge a 10% withholding tax on interest earned where BPL have no such charges. When you then deduct 23% DIRT the rate of return is slightly better with BPL. Just surprised this bank for deposits is not mentioned here as much as Blu Or Bank unless I am missing something!
 
Geralfie said:
When you then deduct 23% DIRT the rate of return is slightly better with BPL
Click to expand...
DIRT rate is 33%, not 23%

You pay a total of 33% in either scenario. The only time it'd be better is for a depositor who is DIRT exempt.
 
This is covered already on the active BluOr thread.

People are confused about the interaction of DIRT and mandatory foreign withholding taxes. A catch-all explainer thread might be worth starting if it doesn't exist already.
 
AndroidMan said:
How would that be better?
You would still have to pay 33% to Revenue right?
Click to expand...
Someone who is exempt from DIRT doesn't pay any DIRT; e.g. over 65, and income below 18k.
With Blu Or there is at least 10% withholding tax. Because you're DIRT exempt, you can't use this as a credit, so you end up with the net amount.
With BPL you receive the gross interest.

3.9% is more than 4.21%*.9
 
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