Savings & Tax

The following is a brief explanation of the two basic share accounts now available with us

1. Regular Share Account:

Dividend is posted gross to the account every year.
It is the responsibility of the account holder to inform the Revenue Commissioners of any dividend posted to the account in his/her annual Income Tax return.
The Revenue Commissioners have the right to inspect the books and records of all financial institutions, including the credit union, with regard to individual’s accounts.

2. Special Share Account:

Dividend is posted net to the account every year after deduction of Retention Tax (DIRT) from the gross dividend earned.
The credit union will deduct the tax and will pay it over to the Revenue Commissioners on behalf of the account holder.
The rate of retention tax will be the prevailing rate announced in the Finance Act each year. It is currently 25% (tax year 2009).
This deduction of tax will fully discharge the Income Tax liability of the account holder in respect of the dividend paid to his/her Special Share Account. The account holder is not required to disclose the amount of dividend earned in his/her annual Income Tax return.

In making your decision, please note the following:

The rate of DIRT is currently 25%. If you pay Income Tax at the higher rate 41%, you will pay less tax by choosing the Special Share Account option. If you pay tax at the standard rate (20%), you will pay the same tax with either option. However, with a Special Share Account, you will not have to declare the amount of dividend that you earn on your annual Tax Return.
Non-residents are not liable for DIRT on their dividend. However, this is conditional on a declaration being made by the member.
Tax-exempted charities, companies subject to Corporation Tax and approved pension schemes are not subject to DIRT.
If your income is so low that you don’t pay any income tax and you are either permanently incapacitated or 65 or over, you are entitled to claim back any DIRT that you pay on your dividend.