Vol. 560 No. 3
236 Mr. Haughey asked the Minister for Finance the arrangements in place for the payment of DIRT by savings account holders; the implications of such payments for the income tax position of these savers; and if he will make a statement on the matter. [2586/03]
I have been informed by the Revenue Commissioners that deposit interest retention tax, DIRT, is operated by relevant deposit-takers such as banks, building societies and other financial institutions. It operates by way of deduction of tax at the standard income tax rate from any payment of interest paid in respect of a relevant deposit. Every relevant deposit-taker must make a DIRT return to the Collector General for every year of assessment. DIRT payments in respect of a year of assessment are payable to the Collector General by the relevant deposit taker and not by the savings account holders.
Where DIRT has been deducted from interest paid or credited to an individual's account, the individual has no further liability to income tax in respect of that interest. The individual may, however, be liable in respect of PRSI and levies in respect of the interest. The interest must be returned on the annual return of income forms. However, in the case of an individual who holds either a special savings account, or special share account or special term share account or special term account as the case may be, interest on such accounts is disregarded as part of the individual's total income as defined for tax purposes.
