Deposit interest retention tax (DIRT; ) is a form of tax on interest earned on bank accounts in Republic of Ireland that was first introduced in the 1980s. In Ireland, income from any source is reckonable for taxation purposes. The Revenue Commissioners believed that the large majority of interest earners were declining to report it and that the most efficient method to collect at least the basic rate tax would be to deduct it at source. After PAYE, it was Ireland's second experience of a withholding tax.
Rates
Current Rate
DIRT is deducted at source by financial institutions. The current rate of DIRT is 33%, having been reduced from higher rates in preceding years.
Higher DIRT Rate
A 'higher rate' of 36% applied to some interest up until the end of 2013. This applied where interest could not be calculated at least annually or could not be determined until it was paid. The Chairman of the inquiry was "shocked and horrified" at the "careless and reckless" manner in which the Governor had quoted false statistics to the Public Accounts subcommittee.
See also
- Taxation in the Republic of Ireland
- Retention tax