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Revised Savings Taxation Directive

The Council adopted on 24 March 2014 the revised Savings Directive (Official Journal L 155 of 15 April 2014, p.50) which strengthens the existing rules on exchange of information on savings income with the aim of enabling Member States to better clamp down on tax fraud and evasion. This was done on the basis of a legislative proposal made by the European Commission on 13 November 2008 as a result of its first review of the Directive.

The main changes to the existing Savings Directive contained in the amending proposal with a view to closing existing loopholes are the following:

  • A look-through approach based on 'customer due diligence' which prevents individuals from circumventing the Directive by using an interposed legal person (e.g. foundation) or arrangements (e.g. trust) situated in a non-EU country which does not ensure effective taxation of the interposed legal person/arrangement on all its income from financial products covered by the Directive;
  • Enhanced rules aimed at preventing individuals from circumventing the Directive by using an interposed legal person (e.g. foundation) or arrangement (e.g. trust) situated in an EU Member State. Those rules involve the reporting by that legal person or arrangement;
  • Extending the product scope of the Directive to include financial products that have similar characteristics to debt claims (e.g. fixed/guaranteed return securities and life insurance wrapper products), but are not legally classified as such;
  • Inclusion of all relevant income from both EU and non-EU investment funds in addition, as contained in the current Directive, to the income obtained through undertakings for collective investment in transferable securities authorised in accordance with Directive 85/611/EEC ("UCITS").  

Council has requested that national rules for transposing the revised Savings Directive should be adopted by Member States by January 2016.

The Commission will aim to reach agreement by the end of 2014 on updating of the existing Savings agreements with five European third countries (Andorra, Liechtenstein, Monaco, San Marino and Switzerland), in line with developments at EU and at an international level.

Both the revised Savings Directive, through further discussions at Council level, and the revised Savings agreements will be aligned with the OECD Global Standard on automatic exchange of information which is expected to be adopted in mid-2014.

For further information: the Council press releasepdf, the European Council conclusionspdf, a statement from the Commissioner , and a presentationpdf of the revised Savings Directive.