DIRT Tax Ireland Explained: How Much Tax on Savings Interest?

DIRT takes 33% of your savings interest. Understanding it helps you compare accounts properly and find tax-efficient alternatives.

What Is DIRT?

DIRT = Deposit Interest Retention Tax

• Rate: 33%
• Applied to: Interest on deposits in Irish and EU banks
• Deducted: Automatically by Irish banks; you declare EU bank interest yourself
• Exceptions: State Savings, certain accounts for over-65s

When you earn €100 in interest, you keep €67. The bank sends €33 to Revenue.

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How DIRT Affects Your Returns

| Gross Rate | DIRT (33%) | You Keep | |------------|------------|----------| | 3.00% | 0.99% | 2.01% | | 2.50% | 0.83% | 1.68% | | 2.00% | 0.66% | 1.34% | | 1.50% | 0.50% | 1.01% | | 1.00% | 0.33% | 0.67% | | 0.50% | 0.17% | 0.34% | | 0.25% | 0.08% | 0.17% |

To calculate after-DIRT return: Multiply gross rate by 0.67

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DIRT Calculator

Quick Formula

After-tax interest = Gross interest × 0.67

Examples

€10,000 at 2% for 1 year:

• Gross interest: €10,000 × 2% = €200
• DIRT (33%): €200 × 0.33 = €66
• You receive: €200 - €66 = €134

€50,000 at 3% for 1 year:

• Gross interest: €50,000 × 3% = €1,500
• DIRT (33%): €1,500 × 0.33 = €495
• You receive: €1,500 - €495 = €1,005

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Who Pays DIRT?

You Pay DIRT If:

• You're Irish tax resident
• You earn interest on deposits
• The interest is from Irish banks OR EU banks

DIRT Is Deducted Automatically By:

• AIB
• Bank of Ireland
• PTSB
• EBS
• Credit Unions
• Bunq, Trade Republic, Revolut, N26 (for Irish residents)

You Must Declare (Self-Assess) For:

• Raisin accounts (EU banks, DIRT not deducted at source)
• Any foreign bank accounts
• Interest from non-EU sources

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What's Exempt from DIRT?

1. State Savings (100% Exempt)

All State Savings products are DIRT-free:

| Product | Gross Rate | Taxed Equivalent | |---------|------------|------------------| | 10-Year Bond | 2.01% | 3.33% | | 5-Year Certificate | 1.74% | 2.95% | | 4-Year Bond | 1.00% | 1.69% | | Savings Bond (3-year) | 1.32% | 2.24% |

To compare: Divide State Savings rate by 0.67 to get taxed equivalent. Example: 1.74% tax-free ÷ 0.67 = 2.95% gross rate needed to match it.

2. Over-65s Exemption

If you or your spouse is 65+, you may be exempt from DIRT on interest up to:

| Status | Exemption Limit | |--------|-----------------| | Single, 65+ | €18,000 income | | Married, one 65+ | €36,000 income |

If your total income (including interest) is below these limits, you can claim DIRT back.

3. Permanently Incapacitated

Those who are permanently incapacitated may also be exempt.

4. Non-Residents

If you're not Irish tax resident, you may be exempt. Inform your bank and provide documentation.

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DIRT and Neobanks

Bunq, Trade Republic, Revolut, N26

These banks do deduct DIRT for Irish residents:

| Provider | Deducts DIRT? | Guarantee Country | |----------|---------------|-------------------| | Bunq | ✅ Yes | Netherlands | | Trade Republic | ✅ Yes | Germany | | Revolut | ✅ Yes | Lithuania | | N26 | ✅ Yes | Germany |

You don't need to do anything. DIRT is handled automatically.

Raisin (EU Banks)

Raisin does NOT deduct DIRT at source. You must:

Track interest earned

Declare on your tax return (Form 11 or Form 12)

Pay DIRT yourself

Important: Even though it's self-assessed, you still owe 33% DIRT on Raisin interest.

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Comparing Tax-Free vs Taxed Accounts

Is State Savings Better Than Bunq?

Let's compare:

| Account | Gross Rate | After DIRT | Access | |---------|------------|------------|--------| | Bunq | 2.01% | 1.19% | Instant | | State Savings 5-Year | 1.74% | 1.74% | 5 years |

State Savings wins on rate (1.74% vs 1.19%) Bunq wins on access (instant vs 5-year lock)

Break-Even Calculation

What gross rate do you need to beat State Savings after DIRT?

Formula: State Savings rate ÷ 0.67 = Required gross rate

| State Savings Product | Tax-Free Rate | Taxed Rate Needed to Match | |-----------------------|---------------|---------------------------| | 5-Year Certificate | 1.74% | 2.95% | | 10-Year Bond | 2.01% | 3.33% | | Savings Bond (3-year) | 1.32% | 2.24% |

Finding: No instant-access account currently beats State Savings 5-Year on an after-tax basis. But Raisin's fixed-term (2.80%) beats the 3-year Savings Bond.

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DIRT History and Future

Rate History

| Year | DIRT Rate | |------|-----------| | 2014 | 41% | | 2017 | 39% | | 2019 | 35% | | 2020 | 33% | | 2024 | 33% |

Note: DIRT was gradually reduced from 41% to 33% between 2014-2020 and has remained at 33%. Future changes are possible.

Why DIRT Exists

DIRT ensures savings interest is taxed, as it's technically income. The automatic deduction means most people don't need to file separately for bank interest.

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How to Claim DIRT Back

If You're Exempt (Over-65/Low Income)

Complete Form 54 (available from Revenue)

Submit to your bank

Bank stops deducting DIRT

Or claim refund via tax return

If DIRT Was Over-Deducted

File tax return (Form 11 or Form 12)

Declare interest received

Claim refund of excess DIRT

Time Limit

You can claim DIRT refunds for up to 4 years after the year it was deducted.

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Common DIRT Mistakes

Mistake 1: Comparing Gross Rates Only

Wrong: "Bunq at 2.01% is better than State Savings at 1.74%" Right: After DIRT, Bunq gives 1.19% while State Savings gives 1.74%

Mistake 2: Ignoring Raisin Tax Obligations

Raisin interest must be declared. Not declaring is tax evasion.

Fix: Keep records, declare on tax return, pay DIRT owed.

Mistake 3: Not Claiming Exemption

If you're over 65 with low income, you may be leaving money on the table.

Fix: Check eligibility, submit Form 54 to your bank.

Mistake 4: Thinking Credit Union Is Exempt

Credit union dividends are subject to DIRT. They're not tax-free.

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DIRT on Different Account Types

| Account Type | DIRT Applies? | |--------------|---------------| | Current account interest | ✅ Yes | | Deposit account | ✅ Yes | | Fixed-term deposit | ✅ Yes | | Regular saver | ✅ Yes | | Credit union dividend | ✅ Yes | | State Savings | ❌ No | | Prize Bonds winnings | ❌ No | | Pension savings | ❌ No (separate tax rules) |

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Practical Tips

1. Always Compare After-Tax Rates

Before moving money, calculate the after-DIRT return:

• Gross rate × 0.67 = After-DIRT return

2. Consider State Savings for Long-Term

If you won't need money for 5+ years, State Savings often beat taxed alternatives.

3. Don't Forget to Declare Raisin Interest

Revenue can see EU bank information via automatic exchange. Declare it properly.

4. Check Over-65 Exemption

If you or your spouse is 65+, investigate DIRT exemption eligibility.

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Summary

| Key Point | Detail | |-----------|--------| | DIRT Rate | 33% | | How to calculate | Gross rate × 0.67 = After-DIRT | | Exempt accounts | State Savings, Prize Bonds | | Self-declare | Raisin and foreign accounts | | Over-65s | May qualify for exemption |

When comparing savings accounts, always look at after-DIRT returns, not headline rates.

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Last updated: January 2026

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Related Guides

• Best Savings Accounts Ireland
• State Savings Guide
• Raisin Ireland Review