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Interest and tax calculation example

Consider a balance of €1,000 with a 2.5% Annual Equivalent Rate (AER), compounded daily, and subject to 19% tax withholding:

Day 1

• Starting balance: €1,000

Day 2

• Interest accrued: €1,000.06 * 2.50%/365 = €0.0684973
• Payable interest: €0.06 (remaining amount keeps accruing until it becomes €0.01)
• Tax accrued: €0.06 * 19% = €0.0114000
• Tax withheld: €0.01 (remaining tax keeps accruing until it becomes €0.01)
• Interest paid after tax: €0.06 - €0.01 = €0.05
• New balance: €1,000 + €0.05 = €1,000.05

Day 3

• Interest accrued: €1,000.05 * 2.50%/365 = €0.0684966
• Payable interest: €0.06 + €0.01 = €0.07 (accrued interest from Day 1: €0.0084932 and Day 2: €0.0084966)
• Tax accrued: €0.07 * 19% = €0.0133000
• Tax withheld: €0.01 + €0.01 = €0.02
• Interest paid after tax: €0.07 - €0.02 = €0.05
• New balance: €1,000.05+ €0.05 = €1,000.10

The Annual Equivalent Rate (AER) on your Instant Access Savings will depend on your plan. To see all applicable rates, visit our Instant Access Savings page on our website.