For residents, interest income on bank deposits and bonds is subject to a 30% final withholding tax. Certain government bonds are exempt from this tax.
In 2013, 80% of the interest on housing loans and 100% of interest on student loans and loans related to the deriving of taxable income are deductible from capital income. As of 2014, 75% of the interest on housing loans will be deductible. In general, 30% of the excess of deductible interest expense over capital income is deductible from income taxes on earned income. However, this credit is limited to €1,400 for a single person and €2,800 for a couple. The maximum amount deductible is increased by €400 for one child and by €800 for two or more children.