Key Post Ensure DIRT period ending 31-12-11, paid in early '12, is charged at 27% and not 30%.

TheJackal

Registered User
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239
I'm sure most people saw this announcement in the Budget yesterday but thought I'd post it anyway.

Btw, make sure your deposit interest for the period ending 31 December 2011, paid in early 2012, is charged at the former 27% DIRT charge and not the new 30% charge.

Some banks have incorrectly done this in the past.
 

The Ghoul

Registered User
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347
If it's coming in on 1st January I presume there is still time to open an interest first account with PTSB under the old DIRT rate?
 

dereko1969

Registered User
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2,910
wouldn't think so the interest will be earned under the new rate which will apply to all accounts that are subject to DIRT.
 

gipimann

Registered User
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4,834
I thought that DIRT was supposed to be charged at the rate on the day the interest was paid, rather than the rate which applied when the interest accrued?
 

STEINER

Registered User
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1,156
I don't know if DIRT applied to interest received after 31st December 2011 for 2011 is going to be 30% or 27%. I imagine that it will be 30% as the interest is paid in 2012.

My credit union always had their AGM in December, last year it was January, and as this year's AGM seems like January too, I am presumably going to pay DIRT AT 30% as the dividend is approved at AGM.

Its a relatively small amount of money involved but I am annoyed that I am paying more DIRT because the dividend is not approved and paid in 2011 tax year.
 
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TarfHead

Registered User
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1,675
30% deducted off the interest earned at a rate of 0.01%, versus 27% previously ? Not a matter of concern for me.
 

MysticX

Registered User
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186
Makes the DIRT free NAMA products more attractive doesn't it? Well that is if one is okay putting savings into the sovereign debt.
 

Gervan

Registered User
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1,076
That's a very misleading title, and may give people the wrong idea.

As gipimann says, the Dirt rate that applies is that at the date of payment.
If deposit interest is paid in 2012, Dirt is going to be deducted at 30%, even though it has accumulated in a 27% period.
 
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4,931
Makes the DIRT free NAMA products more attractive doesn't it? Well that is if one is okay putting savings into the sovereign debt.

NTMA savings not NAMA and yes it does make the NTMA State Savings products more attractive.
 
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4,931
If it's coming in on 1st January I presume there is still time to open an interest first account with PTSB under the old DIRT rate?

The interest does not pay until up to 30 days after account opening with PTSB Interest First so it might be too late.
 

Godfather

Registered User
Messages
602
Can anyone please define "early" in mathematical terms? I disagree with such sentence. I remember last year rabo by mistake charged 27% dirt on yearly interest instead of 25% just because they calculated it in early January but the reference date was 31/12/2011 so they recredited and recharged.
 
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4,931
Can anyone please define "early" in mathematical terms? I disagree with such sentence. I remember last year rabo by mistake charged 27% dirt on yearly interest instead of 25% just because they calculated it in early January but the reference date was 31/12/2011 so they recredited and recharged.

Huh? Any interest paid up to December 31st 2011 are at the old rate.
 

Brendan Burgess

Founder
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43,750
Should people close their accounts this month and then reopen them?

Will only apply
1) If the amount is significant
2) the interest is accrued but not paid
3) there are no penalties for closing early.
 

mtk

Registered User
Messages
563
Should people close their accounts this month and then reopen them?

Will only apply
1) If the amount is significant
2) the interest is accrued but not paid
3) there are no penalties for closing early.


Yes unless interest will be paid on or before 31st dec.
to list i would also add and account type is still available or one at least as attractive
For example On 10k Gross interest the difference is €300 (which FYI implies capital of €250k BTW @ 4% gross )
 
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4,931
Excellent suggestion Brendan.

You get paid interest when your bank account is closed. Hence, you would get hit with the lower DIRT rate.

This would benefit a number of people who will not get paid their interest before December 31st.

For example, some PTSB accounts pay interest each October. Hence, these customers, with large amounts, would be worth considering this option.
 

Godfather

Registered User
Messages
602
Huh? Any interest paid up to December 31st 2011 are at the old rate.

Sorry CiaranT and TheJackal! I misread the title of this thread. Yes, excellent suggestion: I was the one raising the flag first for Rabo charging incorrect DIRT for 2010 at 27% instead of 25%. Sorry but I'd like to point out that... :)
 

TheJackal

Registered User
Messages
239
Got my Ulster Bank interest. Pretty sure I was charged 30% for the quarter ending Oct-Dec 2011 (when 27% applied.)

To my mind I should be charged 27%. Simply because I was given it a day or two into the new year should make no difference; it is a payment for 2011.

Then again, reduction was only 10euro or so, so can't really complain.
 
Messages
4,931
Got my Ulster Bank interest. Pretty sure I was charged 30% for the quarter ending Oct-Dec 2011 (when 27% applied.)

To my mind I should be charged 27%. Simply because I was given it a day or two into the new year should make no difference; it is a payment for 2011.

Then again, reduction was only 10euro or so, so can't really complain.

DIRT has nothing to do with the accrual period.

DIRT is charged based on the payment date.

What was the payment date?
 
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