Key Post The taxation of dividends from German companies

[S class]

Dividends will always have your marginal Irish income tax rate applied.
You could also end up paying a portion of the foreign government tax on top of this if you don't make a foreign tax reclaim.
In the example I gave you could pay 40% Irish tax and 10% foreign tax.

 

[jpd]

Here's a concrete example from my modest investment in SAP based on the 2023 dividend

Number of shares	80​
Dividend per share	€ 2.05​
Gross dividend	€ 164.00​
German withholding tax (25% + 5.5% solidarity surcharge of tax)	€ 43.26​
Net dividend received in my brokerage account	€ 120.74​
Irish tax return (Form 11)
Gross dividend	€ 164.00​
Tax due at marginal rate (40% in my case)	€ 65.60​
Credit for German withholding tax as per double taxation treaty 15%	€ 24.60​
Irish tax due	€41.00​
Tax deducted on behalf of German Tax authority	€ 43.26​
Maximum tax allowed by double taxation treaty 15%	€ 24.60​
Tax reclaimable from German Tax Authority	€ 18.66​

However, I can't be bothered with all the paper work to reclaim the € 18.66 - but if it was a more significant amount, I certainly would even given the long delays reported

 

[daheff]

thank you for this. I think i get where the benefit is.

You pay 25% tax to Germany, but only get credited by the Irish revenue for 15% of that. So theres 10% of additional tax payable because of it.

 

[jpd]

The additional is paid/deducted but it is not payable - you can reclaim it from the German tax authority