Dirt or Income Tax on deposit interest in NI.

[Borderfox]

Just completing form 11 for 2007 (for the first time). I'm a PAYE employee.
I have a deposit savings account in Northern Ireland where I receive deposit interest without tax deducted. Do I have to pay dirt on this gross interest at the current dirt rate in the republic of Ireland of 20% or do I have to pay income tax on this interest at my marginal rate of 41%. The local Revenue office was not sure and informed me that they would look into it!.

 

[Domo]

You declare the NET interest you receive on your tax return form.
In your case, as no tax is deducted, the GROSS is the same as the NET.

Your tax liability will be at your marginal tax rate.

 

[agoose]

Your tax liability will be at your marginal tax rate.

Not clear on this. If after including the interest earned in Northern Ireland I am still in the 20% tax band surely I pay tax at 20% on the lot and not tax on the interest at 41% - or have I missed something?

 

[Domo]

Your marginal rate is the rate of tax you are paying - if you are in the 20% band you pay at 20%.