Trade Republic: 3.75% interest, no payroll requirement, tax risks

Trade Republic offers 3.75% without payroll, but tax authorities are strict

Is it worth depositing €50,000 in a savings account yielding 3.75%? The offer from Trade Republic, a German neobank with deposit protection up to €100,000, has sparked numerous inquiries. An investor admits a friend already deposited that amount after hearing about the account through Marc Vidal. The promise is tempting: no payroll requirement, no fixed term, and monthly interest payments. But the devil is in the details. The account is not tied to a fixed rate: the 3.75% can change, and competitors like Bank Norwegian have already announced cuts. Then there is the Spanish Tax Agency (Hacienda), which does not forgive even a cent.

Monthly interest and fine print

The mechanics are simple: deposited money generates interest paid on the 1st of each month. Several clients confirm this: "On the 1st, you already have the interest in your account," one participant celebrates. This monthly liquidity is attractive but hides a trap: the rate is not guaranteed. Advertising speaks of "transferring" an interest rate, a verb interpreted by forum participants as a sign that remuneration can be adjusted whenever the bank wishes. There is no one-year contract. If the ECB cuts rates, Trade Republic will cut them too. The only cited exception is Revolut, which guarantees 3.56% until March 31 only for new sign-ups.

Is Trade Republic safe?

This question runs throughout the debate. A veteran is clear: "It is totally safe. It is a neobank based in Germany." German deposit protection covers up to €100,000 per client, the European standard. However, not everyone trusts it. "Being a German bank does not miccionan it is unbreakable," warns a skeptic. Distrust increases when the brand appears in Antena 3 ads: "Now they advertise it even in the news, which bothers me," confesses another. Media visibility, far from reassuring, triggers alarms for those who associate mass advertising with bubble risk.

The tax maze: Form 720 and Box 027

Here comes the reality check. Holding money in a foreign bank requires declaration. If the balance exceeds €50,000, you must file Form 720, an informational procedure that does not imply payment, only reporting. But beware: generated interest also counts. A calculation circulating in the forum warns that with €49,999 deposited, annual gross interest can push the balance above the threshold. The recommendation is not to exceed €48,000 to avoid Form 720. Additionally, interest must be declared in Box 027 of the Personal Income Tax (IRPF), where the Tax Agency applies a 19% rate. Neither Sweden nor Spain withhold at source, but that does not exempt you from paying tax. "You cannot escape Hacienda," summarizes a participant.

Competition moves: Bank Norwegian lowers interest

Trade Republic does not play alone. Bank Norwegian, another popular option, has communicated a reduction from 3.70% to 3.45% APR starting September 10. The notice arrived on Friday, August 9, with one month's advance notice, complying with Norwegian regulations. Does it affect existing clients? Yes. "It is not respected. It will drop for all clients, new and current," confirms a product expert. The lesson is clear: in savings accounts, the rate is volatile. Only fixed-term deposits guarantee a return over a period. Trade Republic, as a savings account, does not offer that security.

Worth it compared to MyInvestor or B100?

The comparison is inevitable. MyInvestor offers 2.5% APR in the first year, maintained if €300 is invested monthly, then drops to 0.30%. B100 pays 2.70% on its Save account and 3.40% on the Health account, linked to physical activity. Trade Republic wins on rate but loses on stability. The flexibility to withdraw funds without penalty is common to all. The difference lies in the fine print: investment requirements, balance limits, or physical activity conditions. For those seeking simplicity and the highest rate, Trade Republic is the option. For those valuing predictability, a fixed-term deposit or an account with a guaranteed rate may be better.

In the end, the decision is a tug-of-war between greed and antiestéticar. The 3.75% shines, but Form 720 and Box 027 wait at the end of the road. And as a veteran says: "It is tempting but I still don't trust it." The ball is in the saver's court. Or in the Tax Agency's.