The rates on some bank deposits look very attractive, but not everyone knows that the final income on them may be lower than planned. In pursuit of high interest rates, it is worth considering that the amount received for placing money on the deposit is, in some cases, taxed.
For several years, the Bank of Russia has been monitoring changes in the rates on term deposits in the 10 largest domestic banks. Focusing on their dynamics, the regulator sets the refinancing rate, which is one of the key indicators in the banking sector. It is one of the most important instruments of the country's financial market, since it is designed to regulate rates on the interbank loan market and interest on deposits for legal entities and individuals.
It is the refinancing rate that is involved in calculating the amount of tax that will have to be paid by depositors who have placed their money on more attractive terms than the national average. What is the mechanism for calculating the amounts of personal income tax on deposits, and in what cases will you have to pay tax?
How ruble and foreign currency deposits are taxed
The procedure for taxing income on deposits of citizens is regulated by Art. 224 of the Tax Code of the Russian Federation. It states that if the rate on ruble deposits exceeds the refinancing rate by 5 percentage points, then a tax of 35% will have to be paid from this difference. For example, if the refinancing rate is 8.25%, and the income on the deposit is 15.25%, then personal income tax will be paid from the earned "above the norm" 2%. Today, the personal income tax rate for citizens is 13%, so the amount of tax paid in itself is usually small.
For foreign currency deposits, a simpler calculation mechanism operates: the tax will have to be paid on the amount of income received at a rate exceeding 9% per annum in any foreign currency. It should be noted that the Bank of Russia has provided for a number of effective mechanisms to ensure that deposit rates do not exceed the refinancing rate by more than 25%. In particular, the regulator's attention is focused on banks offering customers really high rates. This is expressed not only in the application of additional supervision measures, but also in penalties. That is why today it is difficult to find a ruble deposit with a rate of more than 12%. Interest rates on foreign currency deposits are firmly established below the 7% mark.
How is tax paid
You will not have to independently calculate the amount of tax and pay it, since each bank takes on a tax agent for its depositors. The tax amount is deducted from the amount of interest income due to citizens. Income will be taxed at the time it is actually paid. The depositor receives in his hands the amount already reduced by the amount of personal income tax due to be paid, and the bank will independently transfer the withheld tax to the budget.
