Schedule D Case III Sources of Income Interest Income not subject to Irish tax at source Income from foreign securities and possessions

Schedule D Case III Basis of Assessment Income taxed in the year of assessment in which it arises. For Case III income arises when it is received. However, foreign trading income and foreign rental income calculated in the same way as domestic trading and rental income.

Schedule D Case III Allowable Deductions No deductions against most sources of Case III income Deduction for foreign tax allowed when not allowed as a credit under a double taxation agreement Foreign rental income is calculated in the same way as Irish rental income Foreign trading income calculated in the same way as Irish trading income

Schedule D Case III UK Dividends UK Interest Taxed on the amount received. UK tax deducted is ignored. UK Interest Taxed on the gross interest. UK tax can be reclaimed from the UK tax authority.

Schedule D Case IV Sources of Income Income subject to Irish tax at source Dividends and interest on special credit union share accounts Shares received in lieu of dividends Income received following the cessation of a trade Profits from unlawful activities Certain maintenance payments

Schedule D Case IV Basis of Assessment Income taxed in the year of assessment in which it is received.

Deposit Interest Retention Tax (DIRT) Financial Institutions obliged to deduct DIRT from Deposit Interest earned on Irish bank accounts. Current rate of DIRT is 41%. DIRT is a full discharge of income tax on deposit interest. Interest income from which DIRT has been deducted will never be subject to the standard rate of tax of 20%

Exempt from DIRT Non-resident individuals Over 65s when their income does not exceed relevant thresholds Permanently incapacitated individuals Charities Pension Funds

Taxation of Deposit Interest Deposit Interest must be included in the Income Tax Computation The Gross amount is included not the net amount May be necessary to regross the net amount An extra line is included in the tax calculation for the 41% rate A credit is given for DIRT paid

Example Mike has the following income: Salary €40,000 PAYE Deducted €5,000 Deposit Interest (net received) €4,020 Tax Credits €3,300

Example Mike is 28 and has the following income: Salary €20,000 PAYE Deducted €700 Deposit Interest (net received) €3,540 Tax Credits €3,300

DIRT Credit The DIRT credit is a non-refundable credit for under 65 year olds The DIRT credit is a refundable credit for over 65s under the exemption thresholds

Schedule F – Irish Dividends Dividends or distributions from Irish resident companies are taxed under Schedule F. Basis of Assessment Dividends are taxed in the tax year in which they are received. The companies financial year for which the dividend is paid is irrelevant.

Dividend Withholding Tax The company paying the dividend is obliged to deduct tax at the standard rate (20%) before they pay the dividend. The individual receives the net dividend. The gross dividend is included in the income tax computation. A Refundable Tax Credit is given in the computation for the tax withheld.