Money market funds (MMFs) offer remarkable liquidity and minimal risk, making them an attractive option. However, it's important to note that MMFs are not the same as cash deposits, and they do carry their unique set of risks. Learn more about these risks here.
While your invested capital comes with inherent risks and returns aren't guaranteed, it's important to know that your investments are covered by the Dutch Investor Compensation Scheme (Dutch ICS). The Dutch ICS offers protection of your investments up to €20,000 against the default of Vivid BV. You can find more details here.
Like all investments, it's vital to recognise that your capital is subject to risk. If you ever find yourself unsure or with questions, don't hesitate to seek professional guidance to ensure your financial security.
Regarding taxes on your gains, it's essential to be aware that investors are responsible for declaring their fund capital gains in their annual income tax return, regardless of whether these gains fall below the tax-free threshold or if withholding tax has been deducted.
At Vivid Money BV, we're unable to provide specific tax advice because the taxation of your investments varies based on your individual situation and local tax regulations. The returns you gain from MMFs may be classified differently according to your region and the tax authority overseeing your finances.
Kindly note that this information doesn’t serve as tax advice and shouldn’t replace professional guidance.