Tax on savings to decrease next year

Savers can count on lower tax on their assets next year. There will be a reduction on the capital income tax - also called the wealth- or savings tax - sources confirmed to ANP after reports in the Telegraaf.

From next year the Tax Office will take more account of the currently extremely low interest rates on savings. Up until now, the Tax Office used the average savings interest rate over five years. From now on, the average annual interest rate will be used in the savings tax calculations, according to the news wire.

That means that next year the Tax Office will use an average savings interest rate of 0.35 percent in its calculations for savings tax, instead of the current 1.63 percent, according to ANP.

The new method of calculation was announced in the Rutte III government agreement. The new government also announced that the tax free portion on savings will increase from 25,225 euros to 30 thousand euros.