philat98

The BTP Valore go on sale next week at the post office. Paying more than 4%pa distributed four times per year they appear quite tempting. Italian bonds are rated BBB so the country might always collapse. The tax on the distribution is low too.

daniel_t

Is the annual return taxable at 12.5%?

philat98

Yes the tax is much lower than a normal savings account. There is normally a cost for keeping the bonds depending on the bank used.

dreamo

Thanks for the heads up. Do they have a fixed term? These are new to me but interesting.

philat98

The duration is 5 years. There is a reward if you keep them the whole term. They are on sale from Monday to Friday next week.

daniel_t

Cheers philat98 - this government bond is attractive as an investment option. 5 years is a reasonable length of time.

Personally, can I entrust my hard-earned money to the Italian government? Probably not. Although there hasn't been a default since 1934, Italy's BBB rating is just a notch above 'junk'.

Mmm maybe life is still simpler with a fixed deposit account that pays 4% to 5% with a UK bank. Everything is done in English.

Thanks again for spreading the word though!

philat98

As an Italian resident I cannot open a UK account. The UK economy is not looking too good at the moment. The BOE has raised interest rates and the value of sterling has fallen. Quite a worrying indication.

daniel_t

I see. By the way, in which section of the tax return Redditi PF should the bond interest payments be declared?

Section RW is for the stamp duty IVAFE on non-Italian bank accounts with a balance above 5,000 euros. But I guess this BTP Valore should be classed as capital gains?

philat98

The tax is deducted from the interest payments by the bank. I dont think you need to declare it.

daniel_t

I see - cheers

Margaret M

HSBC are still allowing Italian residents to open an account.

Geordieborn

... and the BOE stopped increasing interest rates last month... Oh, and it in now nearer 6% for savings. But yes we are stuffed as a nation

daniel_t

I tried ringing up my Italian bank, a German multinational bank actually) this morning to ask them about the government bonds, BTP Valore.

Nobody spoke English. Dismal customer service as usual - if there had been any so-called service at all. I was asked to provide a one-time password for identity verification. Then the customer service agent put me on hold and she swiftly transferred me back to the switchboard(!)

I was really tempted for a second this morning, but now I'm certainly going to let a single penny (or euro cent) of my money go down the drain - or Roman aqueduct!

philat98

I bought some this morning. I arrived at the PO with an appointment at 9am and was still there at 11am. There were other folks buying them and lots of angry persons waiting. The PO computer was running very slow for some reason.

daniel_t

Nice one philat98, but sorry to hear you had to wait so long at the PO. They must have been inundated by the number of bond subscription requests this morning.

My previous message was written in haste. It should read I'm certainly NOT going to let a single penny ...

Fixed-time deposits for me with my UK bank account then.