What is DIRT Tax? Ireland's Deposit Interest Guide
Everything you need to know about DIRT (Deposit Interest Retention Tax) in Ireland - current rates, exemptions, and how it affects your savings.
By SmartSaver.ie | Published 25 February 2026 | 4 min read
Topics: DIRT, tax, savings, interest, Revenue
What is DIRT?
DIRT (Deposit Interest Retention Tax) is a tax automatically deducted from interest earned on savings accounts in Ireland. Banks and financial institutions deduct DIRT at source before paying you interest.
Current DIRT Rate
The current DIRT rate is 33% (2024-2026). This means for every €100 of interest earned, €33 goes to Revenue and you receive €67.
DIRT Rate History
| Year | Rate | |------|------| | 2020-present | 33% | | 2019 | 35% | | 2018 | 37% | | 2017 | 39% |
How DIRT Affects Your Savings
If a savings account advertises 3% AER (Annual Equivalent Rate), your actual return after DIRT is:
- Gross rate: 3.00% AER
- DIRT (33%): -0.99%
- Net rate: 2.01% AER
For a €10,000 deposit at 3% AER:
- Gross interest: €300
- DIRT deducted: €99
- You receive: €201
Who is Exempt from DIRT?
Some people can claim exemption from DIRT:
To claim exemption, complete Revenue Form DE1 and give it to your bank.
DIRT-Free Alternatives
State Savings
All State Savings products are completely DIRT-free:
- Savings Bonds (3-year)
- Savings Certificates (5-year)
- National Solidarity Bonds (10-year)
- Prize Bonds
A State Savings product at 2% is equivalent to a bank account at ~3% before DIRT.
Comparison Example
| Product | Advertised Rate | After DIRT | You Get | |---------|-----------------|------------|---------| | Bank account | 3.00% | 2.01% | €201 on €10k | | State Savings | 2.00% | 2.00% (no DIRT) | €200 on €10k |
Do I Need to File a Tax Return for DIRT?
No. DIRT is deducted at source, so you don't need to include it in your annual tax return. The bank handles everything automatically.
However, if you're exempt from DIRT and didn't claim the exemption, you can reclaim overpaid DIRT through Revenue.
DIRT on Foreign Savings Accounts
If you hold savings accounts outside Ireland (e.g., Raisin partner banks in Germany, Trade Republic), DIRT is not automatically deducted. You must:
This makes EU savings accounts less attractive for higher-rate taxpayers despite higher headline rates.
Frequently Asked Questions
Is DIRT the same as income tax?
No. DIRT is a separate tax specifically on deposit interest. It's deducted at source (33%) regardless of your income tax bracket.
Can I avoid DIRT legally?
Yes, through State Savings products which are DIRT-free, or by qualifying for exemption (over 65 with low income).
Does DIRT apply to credit union accounts?
Yes, DIRT applies to all Irish deposit accounts including credit unions.
What about interest on current accounts?
DIRT applies to any interest earned, including current account interest (though most current accounts pay 0% so there's nothing to tax).