I know DIRT automatically comes off your bank savings interest, but when filling out your end of year tax returns do you have to deduct the 42 % (thats the bracket I am in) on top of the 20% that has already been deducted?
thanks.....
You don't deduct anything, you just enter the gross amount of interest (i.e. the amount credited BEFORE the DIRT was deducted. This increases your standard rate 20% tax band by an equivalent amount, keeping the interest out of the 42% bracket. You may have to pay PRSI and/or levies on the gross amount though.
You can download and run the numbers through a form 11 on the ROS Offline Application from http://www.ros.ie to see the effect.