Withholding tax on EU Deposits - how to declare to Revenue?

[Cooler_box]

Does anyone know why Financial Institutions in the EU deduct WHT at source from Irish investors and what they do with the tax? Do they keep it or pay it to Revenue Ireland? Furthermore, why oblige taxpayers to declare WHT in their country of residence when the Financial Institutions in the EU can, and should, share this information with the Revenue. If a taxpayer doesn't declare WHT deducted at source by a Financial Institution, can they be accused of tax evasion?

WHT @ 20% was withheld on my investment by the foreign bank. I presume I have to pay the Revenue in Ireland the difference (13%)? Anyone know how I do this? There is no option for WHT in 'Manage my Taxes' under declare 'additional income'. I sent a message in 'My Enquiries' and they want me to send them the documentation from the Financial Institute with details of my investment, the interest earned and the WHT deducted. Any thoughts on this, and has anyone been through this?

 

[jpd]

Other EU countries are only entitled to 15% Withholding tax at most on investment income.5

Any amount over that should be reclaimed from the tax authorities in the EU country

You report the gross amount to Revenue and include the tax withheld, up to a maximum of 15% which is a tax credit to offset against the total tax due in Ireland - this could be DIRT at 33% or income tax at your marginal rate depending on the type of investment income

 

[ClubMan]

Might be some useful info here:

site:askaboutmoney.com interest withholding dirt - Google Search

 

[relax carry on]

You don't declare it under manage my taxes. That is for the active tax year.
You declare it under review my taxes 2020 to 2023 where you select what year you are going to file your tax return for. It's then under non paye income, foreign income, EU deposit interest.

 

[Cooler_box]

You don't declare it under manage my taxes. That is for the active tax year.
You declare it under review my taxes 2020 to 2023 where you select what year you are going to file your tax return for. It's then under non paye income, foreign income, EU deposit interest.

View attachment 9644

That's helpful. Thank you.

 

[Cooler_box]

Thanks to everyone for taking the time to help me with my queries. I have two further questions:

Can anyone please confirm my understanding of the process after I file a tax return? I paid 28% WHT to BGP on my investment. When I file my return, will Revenue offset 15% against the 33%, or will I have to pay 33% on the gross interest rate? If so, what will the 15% be offset against? I'm annoyed at having to pay 13% more in WHT; I can't imagine anyone in their right mind would want to put themselves through the whole cumbersome process of claiming WHT in Portuguese.

Second question: When a foreign investment reduces its withholding tax from 20% to 10%. Does it mean zero WHT on my foreign investment when the 15% allowable credit is applied by Revenue Ireland?

 

[Corola]

You can offset 15% out of the 28% paid to Portugal against the 33% to pay to Ireland.

You owe Revenue (33% - 15%) = 18%

 

[Cooler_box]

You can offset 15% of the 28% against the 33%.

You owe Revenue 33% - 15% = 18%

Thanks for that Corola.