The question comes up all the time: you have €20,000 sitting idle and you’re not sure whether to put it in an interest-bearing savings account or a fixed-term deposit. Both are safe, both offer a return, but they work very differently.
What is an interest-bearing savings account?
An interest-bearing account (also called a savings account or interest-bearing checking account) pays interest on the deposited balance. Interest is usually paid monthly, and the rate can change at any time—it’s not guaranteed for the future.
Key features:
- Variable interest rate — it can go up or down
- Immediate liquidity — you can access the money whenever you want
- No penalty for early withdrawal
- Interest paid monthly (in most cases)
- Protected by the FGD up to €100,000 per institution and account holder
What is a fixed-term deposit?
A fixed-term deposit is a contract under which you entrust your money to the bank for a set period (1, 3, 6, 12, 18, or 24 months) in exchange for a guaranteed return. During that period, the bank holds your money and you receive the interest agreed upon at the start.
Key features:
- Fixed interest rate — guaranteed until maturity
- Illiquidity during the term (or penalty if you withdraw early)
- Return known from day one
- Interest paid at maturity or periodically
- Protected by the FGD up to €100,000 per institution and account holder
Current returns in 2026
Best interest-bearing savings accounts
| Bank | APR | Terms |
|---|---|---|
| Trade Republic | 3.00% | No limit, daily liquidity |
| Scalable Capital | 2.50% | No limit, daily liquidity |
| Freedom24 | Up to 5.32% | In USD; lower in EUR |
| Openbank | 2.27% | First 6 months |
| Wise | Up to 3.42% | Currencies, activate manually |
Best fixed-term deposits
| Bank | APR | Term | Minimum |
|---|---|---|---|
| Pibank | 3.50% | 12 months | €1 |
| EVO Bank | 3.20% | 12 months | €5,000 |
| Bigbank | 3.10% | 12 months | €1,000 |
| Raisin (aggregator) | Up to 2.85% | Variable | Variable |
When should you choose each option?
Choose an interest-bearing account if...
- You need access to the money at any time (emergency fund)
- You don’t know when you’ll need the money
- You think interest rates might rise and want to take advantage of that
- Your savings horizon is less than 6 months
- The difference in returns compared to a savings account is small
Choose a fixed-term deposit if...
- You know for sure that you won’t need that money for X months
- You think rates are going to fall and you want to "lock in" the current return
- You want an absolute guarantee of returns from day one
- The difference in returns is significant (>0.5 percentage points)
- You already have a separate liquid emergency fund
Comparative Taxation
In Spain, interest on interest-bearing accounts and on deposits is taxed exactly the same way: as savings income for personal income tax purposes.
| Capital gains tax bracket | Tax rate 2026 |
|---|---|
| Up to €6,000 | 19% |
| From €6,000 to €50,000 | 21% |
| From €50,000 to €200,000 | 23% |
| Over €200,000 | 28% |
There is no tax difference between the two products. What does vary is when you pay taxes: with a 12-month deposit, interest is paid (and taxed) at maturity; with an interest-bearing account, it is paid monthly.
Practical example: €20,000 for 12 months
| Option | APR | Gross interest | Tax (19%) | Net |
|---|---|---|---|---|
| Trade Republic (account) | 2.02% | €404 | €77 | €327 |
| Pibank (12-month deposit) | 2.12% | €424 | €81 | €343 |
| Difference | +0.10% | +€20 | +€4 | +€16 |
In this example, the deposit generates an additional €16 net per year (on €20,000). With current ECB rates at 2.00%, the difference between the account and the deposit is minimal—which makes liquidity even more valuable.
The optimal strategy: combining both
Many investors combine both products:
- Emergency fund (3–6 months of expenses): in an interest-bearing account with immediate liquidity
- Term savings (money you won’t need for 12 months): in a deposit account to maximize returns
This strategy maximizes the return on the money you can tie up, while always maintaining liquidity for unforeseen events.
Frequently Asked Questions
Can I cancel a deposit early?
It depends on the bank. Some allow early withdrawal with a penalty (usually forfeiture of accrued interest), while others do not allow it at all. Always read the terms and conditions before opening an account.
Is a deposit or a savings account better with current interest rates?
With the ECB gradually cutting rates, deposits allow you to lock in current returns for a longer period. Interest-bearing accounts will see their rates decline as the ECB lowers the deposit facility rate. If the yield spread is greater than 0.3–0.5 percentage points, it generally pays off to lock funds into a deposit.
What happens if the bank goes bankrupt?
Both products are covered by the Deposit Guarantee Fund (FGD) up to €100,000 per account holder and per institution. For amounts above that, consider spreading your funds across multiple banks.
Are interest earnings on deposits and accounts taxed the same way?
Yes, exactly the same: as investment income in the savings portion of your income tax return. The bank withholds 19% at source, which you then reconcile on your tax return.