Dáil Éireann Debate, Thursday - 16 July 2026
273. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether the current tax treatment of deposit interest (DIRT) takes into account the real, inflation-adjusted return to savers, as opposed to the nominal return; and if he will make a statement on the matter. [54508/26]
View answerThe Deputy will be aware that Deposit Interest Retention Tax (DIRT) is a withholding tax that is deducted by Irish financial institutions on deposit interest paid or credited on the deposits of Irish residents.
Since 1 January 2020, the DIRT rate is 33%. DIRT is a final liability tax. This means that an individual has no further tax liability in respect of the deposit interest earned.
Deposit interest is specifically excluded from the Universal Social Charge. Individuals may however have a liability to Pay Related Social Insurance (PRSI) in certain circumstances.
There is currently no provision within the Taxes Consolidation Act 1997 (TCA) which provides for an adjustment to take account of inflation. The Deputy should note that the rate of DIRT and its structures was most recently examined as part of the Tax Strategy Group exercise in 2024. This paper is available on my Department’s website.
There are various exemptions from the obligation to deduct DIRT on deposit interest paid or credited by financial institutions. For instance, interest is exempted from DIRT where an account is held by an individual, or their spouse or civil partner, aged 65 years or older, and their total income in a year (including interest earned) is below the relevant income tax annual age exemption limit.
As with all taxes, DIRT is subject to ongoing review. This involves the consideration and assessment of the rate of DIRT and the relevant exemptions from DIRT as part of the annual Budget and Finance Bill process, as well as the wider tax policy context.
