NIB refund: I have recently received a repayment of roughly €25 and €50 interest from National Irish Bank under its customer reimbursement scheme. Customers to whose accounts small manual adjustments in bank charges were made are being reimbursed without costly inquiries to establish whether the adjustments were justified.
My mother was a customer until the early 1990s and has since died. I am one of the executors of her estate and her residuary legatee. I wonder what the tax implications are?
The Revenue officials with whom I have conversed suggest the estate may be liable for the interest if DIRT has not been deducted and I should add what I receive to my Capital Acquisitions (Gains?) tax declaration, although this official did suggest the amount was so small that I should forget it. Perhaps that is the best idea?
When I know how much is due to the Revenue, I wish to pay the balance to a charity my mother would approve of.
Maybe I am not alone in wondering what my liabilities are. I do not want to spend more money to discover them than the amount to be received, and your reply might be of use to others in similar positions.
Mr R.S., Dublin
This just goes to show how even the seemingly most straightforward situation can get ensnared in tax issues. NIB is not unique in this position unfortunately.
AIB is also currently repaying customers for unauthorised charges made on transactions over a multi-year period and, only this week, mobile phone operator Vodafone announced plans to recompense 550,000 customers more than €2.6 million that they were overcharged in relation to phone use over a number of months.
The Vodafone payment also involves a compensatory payment.
I have spoken to NIB and it is clear that there is no DIRT tax issue involved here. The overcharging issues that it is now addressing relate to current accounts on which no interest would have been payable. The "interest" it is now paying you and others relates to the unsolicited use of your money over a period of time. As such, DIRT does not apply.
On capital acquisitions tax - and it would be capital acquisitions tax (CAT - otherwise known as inheritance tax) and not capital gains - I cannot say what the answer would be as your exposure to the tax depends on the size of your mother's estate and how it was apportioned.
However, I can confidently say that it is not worth either your time or the Revenue's in pursuing it. If anything, on the basis of the figures you give, you would be liable to €15 in CAT at most. Forget it, or if you wish, give the €15 to charity.
An Post
I was asked by my wife's aunt who lives in Perth, Australia, to investigate two bonds issued many years ago which have recently come to light. This lady, a widow, has been living in Perth for a number of years and before that in Johannesburg.
The first bond was for ESB 10 per cent premium stock 1980 and Computershare has now sent a cheque for this to the lady.
However, in regard to the second bond, a 9.5 per cent Investment certificate, the Post Office says it has no trace of this and suggests it was paid. However, my wife's aunt has sent me the original bond certificate.
Is she entitled to obtain payment at this stage as the holder of the document? She is certain she has not received the amount due.
Do you think that she is entitled to enforce payment? If you feel she has a claim, what action do you suggest? I enclose a copy of the bond with my original letter to An Post and its reply to me.
Mr J.F., Dublin
The big question here is whether or not this bond has already been repaid. It is not helped by the time lag.
This certificate was issued in 1977 and matured in 1982, when it was due to pay out a premium of 5 per cent. Holding the bond beyond this date didn't enable the lady for whom you are acting to secure any extra return on the investment.
In your favour, the fact that the ESB paid the other bond may lead one to think that these bonds have simply been lying somewhere gathering dust and are due for payment upon presentation.
A significant point in this lady's favour is that this investment was for what was, in 1977, a significant sum and it is unlikely although not impossible that she would have cashed an investment of this scale and subsequently forgotten about it.
You would imagine that the fact that the lady for whom you are acting holds the original certificate would be a clincher. However, An Post tells me that possession of the certificate does not necessarily mean that it has not repaid the amount owed at some point. A spokesman says it is not unusual for customers seeking repayment to have mislaid a certificate.
More significantly, in the mid-1990s, An Post computerised its records. As part of that exercise, all "live" accounts at the time - even ones as historic as this investment - should have been transferred to the new system. The details of this certificate do not appear on the computerised records, leading An Post to surmise that it must have been repaid.
Having said that, it has confirmed to me that it will be carrying out a search of its archived manual records to confirm whether the certificate was encashed or simply passed over in the computerisation process.
Not surprisingly, this will take some time, so you will need to be patient. However, at least it is an advance on the somewhat cursory letter you received from An Post's customer administration department last month.
Having stated that the bond details did not feature among the unclaimed investment bonds, it continued: "Due to the statute of limitations, no further information is available on this bond. Financial institutions are required to hold encashment details for six years. After 20-plus years, the information is simply non-existent," before adding the somewhat fatuous conclusion that it hopes this information "is of some assistance".
As is now clear, An Post does appear to have manual records covering this period and can and will search them in accordance with what it says are "normal procedures".
In any case, as the recent situation with dormant accounts makes clear, even when dormant money is transferred elsewhere - such as to the National Treasury Management Agency in relation to deposit accounts and insurance policies - the owner always has the right of reclaim regardless of the time lag.
If An Post had persevered in the unhelpful vein of the customer administration letter, your position would have been pretty clear according to advice I have received. Your wife's aunt holds an original certificate and, in the absence of proof from An Post of repayment by it or its predecessors, An Post would be obliged to honour it.
Thankfully, An Post has now moved beyond its earlier statement to you. It's a pity its customer service people could not have been more helpful.
Please send your queries to Dominic Coyle, Q&A, The Irish Times, D'Olier Street, Dublin 2 or e-mail to dcoyle@irish-times.ie. This column is a reader service and is not intended to replace professional advice. Due to the volume of mail, there may be a delay in answering queries. All suitable queries will be answered through the columns of the newspaper. No personal correspondence will be entered into.
