Why Are The Over 65's D.I.R.T. Exempt

Any idea how much a person could have saved before the interest bring's you over the €36,000? My Mother has aprox. €50,000 in savings in one account and another €10,000 in a very low interest a/c. She is afraid to lodge the €10,000 with the €50,000 in case it brings her over a limit. I have looked at revenue but it's impossible to understand any of it.
I would have thought it would be easier just to say once you save say €70,000 you then must pay DIRT for example.

Anybody an easy explanation?
 
If you take a fairly generous interest rate of 4% you would need to have €900,000 on deposit to earn €36,000 in interest.

However the total income of the person is taken into account when calculating if they are over the threshold of 36K for tax purposes.
 
"Income would not include say that they already had €50,000 saved would it?"

I don't understand this sentence.

I think what you are getting at is that all income including interest is included, and then compared with the 36,000 tax exemption limit????
 
From the Revenue website:

DIRT Tax Repayment Claim


A person or his/her spouse who is:
  • aged 65 or over or
  • is permanently incapacitated and
  • their total income (including the Gross DIRT Income) is less than the relevant exemption limit can claim a repayment of DIRT paid by submitting
 
"I think what you are getting at is that all income including interest is included, and then compared with the 36,000 tax exemption limit???? "

Yes - is my mother ok with €60,000 saved and still pay no dirt. How high can you go with your savings and still no dirt? The information on the revenue website make's no sense to me.
 
That is very good, wish we had the same in the UK, I am over 65 and if I earn more than my tax free allowance of £9,940 I will be taxed at 20% which included interest on saving, part time employement and state pension etc., all income over £9,940 will be taxed at 20%.

Time I move back home to Ireland me thinks.....:)
 
Theresa,

first of all you have to know the person's pension income. Then you add the interest income.

60k in savings at 4% gross interest rate means about 2,400 in interest.

Add that to the pension income. By you using 36k means it's a married couple.

Check if the total income, including interest, is less than 36k.
 
Theresa,

also note that the tax exemption limit is 18k for a single person over 65.

It's 36k for a married couple.
 
Only on old age pension - single - so basically income for the year plus interest earned and as long as that added together dosent take you over €18,000 your fine?
 
As you do not say whether you mum has Contributory or Non-Contributory I am assuming Contributory Pension of Around 12K. Add to that say 2,400 of interest on savings and the total income is around 14,400. Still below the maximum exemption rate of 18K, therefore no DIRT payable.
 
Can anyone clarify the current income exemption for a 67 year old single person ? I presume the interest on any deposit is counted as income ? Also what changes when you are 70 - are you exempt from dirt regardless of pension ?
 
to belview ,, (post no 1) the reason a dirt exemption was brought in is, old people kept any money they had for their funerals etc , under matteresses and other hiding places in their homes. what happened was a lot of homes were burgled even in daylight when local gurriers got some info regarding the personal details of some people . this happened mainly in isolated areas of the country but not exclusivly. at times there were couples calling to houses with all sort of alibis , esb/county council/eircom etc to check things out,and when they gained entrance the money disappeared , and briefly that is how it came about to encourage old people with a few quid saved to bank it.
 
Very strange measure to take in order to reduce burgaries , sure it was a way to keep the silver voters happy , our government s don't like to encourage savings
 
there was a lot of violence went with the buglaries. and at that time the governments did encourage people to save , hence the popularity of the gov saving schemes. they introduced 2 or 3 new plans at the time through the post office system . when i was in my twenties which was many many years ago there was only one post office scheme , it was called saving certificates. if you can look back at old papers on line you can see for yourself.
 
Note to Belview: That from 65 to 70 we are not up to the €36,000 taxable limit we have the household benefit package which is slowly being wittled away, but we still are not entitled to a Medical Card, (only a GP card) We pay for drugs approx €100 a month (up to €136) and hospital stays etc. What little savings we have, is not worth claiming the DIRT
 
You must log in or register to reply here.
Back
Top