Non resident DIRT exempt

H

Horatio

Registered User
Messages
773
I seem to remember reading on the literature published ion DIRT that non residents with money on deposit in Ireland are DIRT exempt, can anyone verify this?

Never mind, just found it:
http://www.revenue.ie/en/tax/dirt/index.html

Deposit Interest Retention Tax
Deposit interest retention tax (D.I.R.T.), at the rate of 25% (from the 8th April 2009) is deducted at source by deposit takers (e.g. banks, building societies, Credit Unions, Post Office Savings Bank, etc.) from interest paid or credited on deposits of Irish residents.
The above D.I.R.T. rate was
  • 23% for the period 1st January 2009 to 7th April 2009 and
  • 20% for the period 1st January 2002 to the 31st December 2008.
D.I.R.T. does not apply to
  • Interest on deposits beneficially owned by non-residents,
  • Deposits of Companies within the charge to Corporation Tax,
  • Deposits of Revenue approved Pension Schemes, and
  • Deposits of persons who are entitled to charitable exemption from tax.
A D.I.R.T. rate of 28% is payable on interest earned on a deposit where the interest cannot be calculated annually or more frequently and the interest cannot be determined until it is paid.
The above D.I.R.T. rate was
  • 26% for the period 1st January 2009 to 7th April 2009 and
  • 23% for the period 1st January 2002 to the 31st December 2008.
D.I.R.T. is a final liability for income tax purposes, i.e. the payment of retention tax at the standard rate by individuals liable to income tax at the higher rate is regarded as satisfying the individual’s full liability to this tax.
DIRT Refunds

If an individual is aged 65 or over or they are permanently incapacitated, they may be entitled to a refund of DIRT. For more information see DIRT Repayments. For forms applicable to DIRT Exempt Accounts, please see Forms
Tax & Duty Manuals - Section 16 FOI Act
 
A financial institution that I worked for read that "Interest on Deposits beneficially owned by non-residents" meant that an Irish person living in Ireland could open a non resident account using an Irish address provided that the interest was posted abroad to a non resident by the financial institution.

If you read the above you will see that all references are made to interest and not capital.
 
If you are non-resident in Ireland, and are receiving interest on Irish deposits, you can opt to receive the interest gross, without deduction of DIRT.
If you are resident elsewhere in the EU, the tax authorities there will be notified, and you will pay any relevant tax in the country in which you are resident.
If you are resident outside the EU, you would have to look at the tax treaty applicable to your country of residence.
 
WaterWater said:
If you read the above you will see that all references are made to interest and not capital.
Click to expand...

Fair enough but DIRT doesn't apply to capital in the first place, it only applies to interest, otherwise if I invested E1000, I'd be liable to pay 250 tax on the capital & that doesn't sound right at all, at all.
 
Gervan said:
1) If you are non-resident in Ireland, and are receiving interest on Irish deposits, you can opt to receive the interest gross, without deduction of DIRT.
2) If you are resident elsewhere in the EU, the tax authorities there will be notified, and you will pay any relevant tax in the country in which you are resident.
3) If you are resident outside the EU, you would have to look at the tax treaty applicable to your country of residence.
Click to expand...

Thanks Gervan,
I fall into the third category.

I intend to purchase An Post saving certificates in my name & my childs name (beneficiary), has any non resident on these boards done the same, I'd be interested to see how the application was handled, if there were complications or blank stares across the counter?

I will be purchasing on a trip back to Ireland this year & need to get all my ducks in a row before hand, I don't want to be tooing & froing with the counter staff to get this set up. Any tales of experience are appreciated.

Have a nice weekend y'all.
 
Ulster Bank will not withhold DIRT if you can prove residency outside the country, provide proof of address, etc. An Irish address disqualifies you. It is relatively straightforward, can't remember what documents they needed, credit card statements, utility bills, that kind of thing.

If you are a US resident, and you don't do the above, it is a real pain to reclaim DIRT withheld. In that case, you need to have to send the Revenue a special form from the IRS confirming US tax residency and payment, and applying for that form is long-winded and there are application fees. So as a non-resident if you have any sort of a deposit account in Ireland, it pays to sort out the DIRT thing ahead of time so the tax is not withheld.
 
Worksop - I believe you meant to say that Ulster Bank will withhold DIRT if you can prove non residency. The process is quite straightforward. This will mean interest will be paid gross with no DIRT deducted.

As an FYI - PermanentTSB have a similar policy as Ulster Bank. ESB have a policy of not using similar non residency revenue forms and will deduct DIRT even if you have a non residents address. You will then need to recover this through the DIRT refund process with the Revenue.
 
icon987 said:
Worksop - I believe you meant to say that Ulster Bank will withhold DIRT if you can prove non residency. The process is quite straightforward. This will mean interest will be paid gross with no DIRT deducted.
Click to expand...

Yes, sorry if I was unclear. I meant "DIRT will not be withheld on behalf of the Revenue." In other words, gross no deductions.
 
Can you nominate to have your interest posted abroad to a child or similar and avail of the interest DIRT free? The interest will be going to a NON resident.
 
Odea said:
Can you nominate to have your interest posted abroad to a child or similar and avail of the interest DIRT free? The interest will be going to a NON resident.
Click to expand...

Well, "IANAL" as they say, but I would say its unlikely. Kind of having your cake and eating it? I would guess the Revenue would arch an eyebrow at you and then suggest that you transfer the capital to the non-resident child and then have that person contact the Revenue to see about DIRT exemption.
 
Odea said:
Can you nominate to have your interest posted abroad to a child or similar and avail of the interest DIRT free? The interest will be going to a NON resident.
Click to expand...

No, the account needs to be in the name of a non resident.
 
fungus said:
No, the account needs to be in the name of a non resident.
Click to expand...

Does it specifically say this somewhere? I thought that it said,

Interest on deposits beneficially owned by non-residents,

If the interest is owned by the non resident does that not qualify.
 
BOXtheFOX said:
Does it specifically say this somewhere? I thought that it said,

Interest on deposits beneficially owned by non-residents,

If the interest is owned by the non resident does that not qualify.
Click to expand...

If that was the case it should read 'interest beneficially owned by non-residents on deposits...'
 
Gervan said:
If you are non-resident in Ireland, and are receiving interest on Irish deposits, you can opt to receive the interest gross, without deduction of DIRT.
If you are resident elsewhere in the EU, the tax authorities there will be notified, and you will pay any relevant tax in the country in which you are resident.
If you are resident outside the EU, you would have to look at the tax treaty applicable to your country of residence.
Click to expand...

--------------
I fall into the second Category, who is notifying Italy that I am not paying Dirt in Ireland ? how is it working ?
thanks
Vincent
 
You must log in or register to reply here.
Back
Top