Need help finding the right documentation on dividend taxes

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gonesp

Registered User
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Hi there,

I've been searching all over Revenue's tax guides on dividends, but can only find information relating to the corporation tax treatment of dividends. I'm an investor, but not a corporation, so I assume this documentation doesn't apply to me. I'm looking for information regarding company share related dividends

I found a lot of information on DWT (Dividend Withholding Tax) though, which I think is very clear, but that was it.

Can anyone point me to the guide where taxation of dividends is detailed so I can read it?

Thank you!
 
Itchy said:


Dividend income to an investor is unearned income for the purposes of calculating your tax position.
Click to expand...

Thanks for sharing these. I had found both of these articles earlier and read them, but found no information regarding the taxation nor any reference of the rates. I've noticed these articles detail some of the rules and reference DWT and how it should be charged, but I feel as if I'm missing something, I can't find any official guides detailing the Income Tax, PRSI and URC required for dividends.

Do you know where I could find these?
 
jpd said:
Dividend income is treated just liek other unearned income

What exactly do you want to know?
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I'm looking for answers for a couple of questions:
  • I'm aware that dividends are liable for Income Tax, PRSI and USC, however, I've found that PRSI is only applicable if the earnings were larger than 5k a year. Source: Source "A person is not a 'chargeable person' if their income from non-PAYE sources is less than €5,000 and this income is taxed under the PAYE system." Am I understanding this correctly? I'm actually a PAYE, but this income is coming from personal investments.
  • I've found information about the PRSI rates and USC rate bands, but can't find any information on Income Tax and its applicable rate. Does this Income Tax just fall under the typical Income Tax bands shown here?
  • I can't find any information on where to pay for this Income Tax, PRSI and USC when it relates to dividends.
 
Q1 Correct it is as it says on the tin - you a non-chareable person if your income other than PAYE is under € 5,000

Q2 Un-earned income - for example dividend income, rental income - is just added to your earned income for the purpose of the Income tax calculation (including gross interest subject to DIRT of course)

Q3 You file a form 11 or 12 and make the payment when filing or before 31st October
 
jpd said:
Q1 Correct it is as it says on the tin - you a non-chareable person if your income other than PAYE is under € 5,000

Q2 Un-earned income - for example dividend income, rental income - is just added to your earned income for the purpose of the Income tax calculation (including gross interest subject to DIRT of course)

Q3 You file a form 11 or 12 and make the payment when filing or before 31st October
Click to expand...

Perfect! Thanks for the information!
 
jpd said:
Q1 Correct it is as it says on the tin - you a non-chareable person if your income other than PAYE is under € 5,000

Q2 Un-earned income - for example dividend income, rental income - is just added to your earned income for the purpose of the Income tax calculation (including gross interest subject to DIRT of course)

Q3 You file a form 11 or 12 and make the payment when filing or before 31st October
Click to expand...

Just another quick question: I'm aware of where I would declare share-based dividends in Form 11, but ETF-based dividends are taxed differently, so where would I be able to declare ETF-based dividends? I can't find any information on this particular detail.
 
Yes you need to declare ETF distributions (taxed at 41%) and disposals (gain taxed at 41%)
 
jpd said:
Yes you need to declare ETF distributions (taxed at 41%) and disposals (gain taxed at 41%)
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Right, but where exactly would I be able to declare those? I can't find a correct field for them in Form 11
 
Assuming the funds are not held by an Irish broker or insurance company who will deduct the tax before making the payment,
in the Foreign Income, Offshore Funds

Distribution is Payment taxable at 41%, Gain on disposals deemed or otherwise is Gain taxable at 41%

4945
 
jpd said:
Assuming the funds are not held by an Irish broker or insurance company who will deduct the tax before making the payment,
in the Foreign Income, Offshore Funds

Distribution is Payment taxable at 41%, Gain on disposals deemed or otherwise is Gain taxable at 41%

View attachment 4945
Click to expand...

So there is no distinction between dividend gains and interest on a sale gains?
 
Sorry, I do not understand your question

There is no such thing as "dividend gain"
- a dividend is a distribution or payment from the fund/company
- a gain is a profit you make when you sell or dispose of something

There is no such thing as "interest on a sale gains"
- interest is a payment from a borrower to a lender eg on a savings account
- sale gains are the difference between the cost of acquisition of an asset and the proceeds from the disposal, or deemed disposal in case of an ETF fund

The Exit tax is the same for both distributions and gains - 41%

I presume that Revenue want to know which is a distribution and which is a gain.
If you declare gains, they may wish to ask where and when you purchased the fund - you have to report purchases on Form 11 in the 2nd part of the diagram above
 
jpd said:
Sorry, I do not understand your question

There is no such thing as "dividend gain"
- a dividend is a distribution or payment from the fund/company
- a gain is a profit you make when you sell or dispose of something

There is no such thing as "interest on a sale gains"
- interest is a payment from a borrower to a lender eg on a savings account
- sale gains are the difference between the cost of acquisition of an asset and the proceeds from the disposal, or deemed disposal in case of an ETF fund

The Exit tax is the same for both distributions and gains - 41%

I presume that Revenue want to know which is a distribution and which is a gain.
If you declare gains, they may wish to ask where and when you purchased the fund - you have to report purchases on Form 11 in the 2nd part of the diagram above
Click to expand...

Ah, I see now! That's exactly what I needed to know. The wording of "Payment" seems a bit off though. What other kind of distributions could there be from a fund besides dividends?
 
Dividends are usually paid from income the funds has made - companies can pay back some the the share premium the got from issuing shares but I don't think funds are allowed to do this
 
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