Withholding tax on foreign savings interest: what do you really keep?
· 4 min read · Spaarradar editorial team
A few European countries withhold tax on the interest you receive there. Per country: what is withheld, which form lowers it, and when the higher rate is still worth it.
A fixed-term deposit at a bank in Portugal or Latvia can have a higher rate than anything you will find in the Netherlands. But not all of that interest always reaches your account. Some countries withhold tax before the interest is paid out: withholding tax. If you do not know that, you are comparing apples with oranges.
What withholding tax is
Withholding tax is tax that the bank's country withholds on your interest at the moment it is paid out. The bank passes it on to that country's tax authority and you receive the rest. The Netherlands has no withholding tax on savings interest, and most countries where Dutch residents save do not charge it to foreign savers either.
Among the countries that do, there are two kinds:
- countries where a form gets you fully exempted;
- countries where a form gets you a lower treaty rate, but not zero.
Per country
This table contains the countries whose rules we have read up on in the tax information that Raisin publishes per country. It concerns private savers who live in the Netherlands.
| Country | Withheld by default | For a resident of the Netherlands | What you need to do |
|---|---|---|---|
| Germany, Sweden, France, Italy, Finland, Luxembourg, Estonia, Malta | 0% | 0% | Nothing |
| Spain | 19% | 0% | Declaration of tax residence, done digitally at Raisin when opening |
| Belgium | 30% | 0% | The Belgian withholding-tax certificate for non-residents (attest roerende voorheffing niet-inwoners) |
| Slovakia | 19% | 0% | Certificate of tax residence from the Dutch Tax Administration (Belastingdienst), well before the end date |
| Romania | 10% | 0% | Certificate of tax residence, well before the end date |
| Portugal | 28% | 10% | Certificate of tax residence and form Mod. 21-RFI |
| Latvia | 25.5% | 10% | Latvian certificate of tax residence, eight weeks before the end date |
| Lithuania | 15% | 10% | Lithuanian certificate of tax residence, four weeks before the end date |
Rules and rates can change. Every offer in the comparison shows the current status, and when you open an account the bank or Raisin gives you the forms that go with it.
What difference does it make in euros?
Take a deposit of €10,000 at 3.00%. That earns €300 in interest per year.
- Without withholding tax you receive €300.
- With 10% withholding tax you receive €270. The rate is then in effect 2.70%.
- If you forget the form and 28% is withheld, you receive €216. In effect 2.16%.
So a deposit at 3.00% with 10% withholding tax only becomes interesting if the alternative without withholding tax is below 2.70%. The percentages here are a worked example; today's rates are in the comparison.
The certificate of tax residence
For almost every reduction you need a certificate of tax residence: a document in which the Dutch Tax Administration (Belastingdienst) confirms that you are liable for tax in the Netherlands. You apply for it at the Belastingdienst. Allow for a few weeks of processing time and for the bank's deadline. That is often four to eight weeks before the end date of the deposit. If you are too late, the full rate is withheld, and reclaiming it from the foreign tax authority is a good deal more laborious.
And Dutch tax?
In the Netherlands, savings fall in box 3. That tax depends on your total assets and your personal situation, not on the interest on one account, and so it is not in our calculation. Whether you can offset tax withheld abroad in your tax return depends on the tax treaty and on your situation. For that, look at the Belastingdienst website or ask a tax adviser.
How to use it in the comparison
- Every offer shows whether there is withholding tax and what is left for a resident of the Netherlands.
- Would you rather not have to deal with it at all? The page saving without withholding tax only shows offers from countries that withhold nothing.
- The term is also explained briefly in the glossary.
Not advice. Rates are gross and can change; the tables in this article show the position at the moment you open the page. How we calculate and check is described in the methodology.
