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Couples missing out over tax exemptions

Published on 12/09/2005

12 September 2005

BRUSSELS — Married or legally co-habiting couples who have a joint savings account are missing out on tax exemptions because banks are still applying old regulations.

These couples are legally entitled to double the tax exemption — amounting to EUR 3,100 — on their interest-based income.

However, banks are still applying old regulations granting a single exemption of EUR 1,550, newspaper ‘De Tijd’ reported on Monday.

“The application of the separation of incomes regulation is posing too many practical problems,” the Belgian Association of Banks (BVB) said.

“We are negotiating with the Ministry of Finance over a solution.”

Recent tax reforms led to the separation of income for married and legally cohabiting couples. The reforms were included in this year’s tax forms.

It meant that tax for each partner would be separately calculated, offering separate benefits via tax exemptions.
Finance Minister Didier Reynders sent banks a letter at the start of this year informing them that the regulation stipulating the separation of income should also apply to savings accounts listed under the name of both couples.

However, banks are unsure whether the joint savings accounts are actually mutual accounts and are requesting a written declaration from the partners to prove it. This is posing problems for the banking sector.

The BVB said it is striving for a simpler, standard procedure that can be integrated into existing banking computer programmes. It is locked in talks with Minister Reynders.
Reynders has confirmed that negotiations are being held, but stressed the nation’s banks were obligated to apply the tax reforms.

Only one bank has until now succeeded: Argenta. It is not a member of the BVB.

[Copyright Expatica News 2005]

Subject: Belgian news