Are you over-65 or a first-time buyer? You may be able to claim back the DIRT on your savings.
If you or your spouse are 65 or over and your annual income is within certain limits, you shouldn’t be paying DIRT at a rate of 41% on any income earned on deposits. This means that you could be due a refund. This also applies to individuals who are permanently incapacitated.
What is DIRT?
Deposit Interest Retention Tax (DIRT) is deducted at the source from interest paid on most deposits held by Financial Institutions such as Banks, Building Societies, the Post Office Savings Bank and Credit Unions. There is no further tax liability on this interest but it must be declared on your annual tax return.
What are the income limits?
For 2016, the limits are as follows:
€18,000 for Single People or Widowed Persons or Surviving Civil Partners.
€36,000 for Married Couples or Civil Partners (combined income).
These exemption limits are increased by €575 for each of the first two dependent children and by €830 for each subsequent dependent child.
Joint accounts only qualify for the exemption where the two account holders are a Married Couple or Civil Partners.
What forms do I fill out in order to get a refund?
If DIRT has already been deducted from your account, you need to download and complete form 54 from the Revenue website and submit it to your local revenue office together with Certificates of Interest subject to DIRT from your Financial Institution.
Do I need to fill out this form every year?
No. You can apply directly to your Financial Institution to have the interest paid without deduction of DIRT where you satisfy the above conditions. You must download and complete the DE1 Declaration Form from www.revenue.ie.
A separate declaration form is required from the account holder for each account held with each Financial Institution.
What about first-time buyers?
First-time buyers can also claim back DIRT on savings for a deposit for their house. While not many have (figures for last year show just 74 claims were made), with the average refund amounting to €1,000 which is not insignificant.
Who is entitled to claim?
A first-time buyer of a house or apartment who purchases or self-builds a property between 14 October 2014 and 31 December 2017 may be entitled to claim a refund of DIRT.
The first-time buyer must not have either individually or jointly with any other person, previously purchased or built a house or apartment.
The property must have been purchased or built as the first-time buyer’s home. It does not include properties acquired for investment purposes.
How to make a claim
To make a claim, the property must be registered for Local Property Tax (LPT). Once registered, you log in to the LPT system on www.revenue.ie and enter your PPS number/Tax Reference Number, Property ID and Secure LPT PIN.
Once in the LPT system, you click the Claim DIRT F.T.B. Refund button. This will display a claim form and you enter the required information and submit your claim.
