Tax on dividend payments for 2006

[Afterdark]

Anyone know when tax is due for dividends received during 2006 and what form is used to make those payments ?

If witholding tax was held at 15% on the amount received is it true that (42%-15%) is due on the rest.

for example. If €100 was paid in dividends and 15% was withheld so i received €85. Is the payment due then (42%-15%) = 27% of 100 = €27.

So i receive €58 (100-42) and owe tax of €27.

Does that make sense.

 

[ClubMan]

If witholding tax was held at 15% on the amount received is it true that (42%-15%) is due on the rest.

If you are a 42% taxpayer then that would be so as long as you have a suitable witholding tax credit certificate (normally included with the dividend payment). However 15% is an odd witholding tax - how did this arise? Normally DWT is 25% (I think).

If €100 was paid in dividends and 15% was withheld so i received €85. Is the payment due then (42%-15%) = 27% of 100 = €27.

So i receive €58 (100-42) and owe tax of €27.

Does that make sense.

Seems correct to me.

 

[jpd]

The payment is due when you make your tax return for 2006 ie by 31st October 2007. A preliminary tax payment may be due by 31st October 2006 but you can always use the option of paying 100% of the 2005 bill as the preliminary in which case if you had no dividends in 2005, there is nothing owed

 

[Afterdark]

If you are a 42% taxpayer then that would be so as long as you have a suitable witholding tax credit certificate (normally included with the dividend payment). However 15% is an odd witholding tax - how did this arise? Normally DWT is 25% (I think).

Yeap a paye tax payer. I usually get the tax certificate of what was withheld in total between all shares at the end of the year from the broker.

Not realy sure how the 15% worked out. It's with a US broker i'm dealing with as they are us shares i got the dividends with. Originally signed the W8BEN form so the 15% was reduced from a higher % and that's the figure they arrived at. Asked them about this originally and they said that's the mimimum they take when you have the W8BEN formed filled out. The rest of tax owed is within your own country on the difference with your rate of tax.

Seems correct to me.

Cool. Wasn't sure if it was 27% of €85 or 27% of €100.

 

[Afterdark]

Just checked this further with the revenue and here's what they said.

"It depends on the amount of the Dividends received. If the dividends received are more than €3174 then you need to register for income tax and pay the tax due by 31st October 2006. If it is less than €3174 then you can pay the tax due when you receive a balancing statement based on the Form 12 you would submit for 2006 next year".

This is if you are a PAYE worker. So it looks like all you have to do is send in your form 12 for 2006 mentioning the dividends you received in 2006 and they will send you out a balance statement on what is owed in tax which can be payed by the 31october 2007. Only if it's less than €3174.