A woman opened a Special Savings Incentive Account and arranged to contribute monthly by way of direct debit. Some months later, the direct debit was cancelled because there were insufficient funds in her account to pay for it.

The woman received a cheque from the credit institution, which told her that the cheque represented the balance in the now closed account minus the Special Savings Incentive Scheme tax of 23 per cent on the value of the investment.

She complained that the credit institution had not properly explained the rules of the scheme, in particular the consequences of missing a monthly payment during the first 12 months.

The institution pointed out that it was bound by the Revenue rules of the scheme and these had been made known to the complainant through its brochure, application form, declaration and direct debit mandate.

The Ombudsman noted that the rules of SSIAs require a payment of a monthly subscription during each of the first 12 months of the five-year term. Once payment failed during the first 12 months, the institution had no option but to comply and close the account and apply cessation tax at 23 per cent.

He found the wording of the institution's documentation was unambiguous and had clearly warned of the failure to make a lodgment during the first 12 months.

As a result, the Ombudsman took the view that the institution was not responsible for the loss and inconvenience suffered by the complainant. The complaint was not upheld.