More Irish savers than ever are moving their money online. Platforms like Raisin, and other European savings providers offer access to higher interest rates to help your savings work harder.
It’s a smart move. But there’s one important difference many savers don’t realise at first:
Your interest will not be taxed automatically in Ireland.
If you’re earning interest from foreign savings accounts, you may need to declare it yourself. This guide explains how it works and how FastTax.ie helps to make sure you stay fully compliant with Revenue.
How savings interest is normally taxed in Ireland
If you have a savings account with an Irish bank, the tax is simple. Your bank automatically deducts DIRT (Deposit Interest Retention Tax) before paying you your interest. The current DIRT rate is 33%. No further tax is then due on the interest apart from PRSI in certain cases.
Why foreign savings accounts are different
When your savings are held outside Ireland (including accounts opened through Raisin), the situation changes.
In most cases:
- You receive the full gross interest without any tax deduction
- Or you may pay some foreign tax on the interest at source that you have to claim a credit for in your Irish tax return
- You are responsible for declaring it to the Irish Revenue
Put simply, the responsibility to declare interest moves from the bank to you, i.e. self-assessed.
This applies to:
- Raisin accounts
- European deposit accounts
- Online savings platforms
- Foreign bank savings accounts
If you are Irish tax resident, the rules apply regardless of where the bank is based.
How foreign savings interest is taxed
EU deposit interest is generally taxed at the same rate as Irish DIRT, which is currently 33%. Interest earned on foreign savings in banks outside the EU may be charged at the higher of your marginal rate or DIRT. Depending on your circumstances, PRSI may also apply.
The key difference is: you must declare the interest yourself through your tax return. This is usually done using a Form 11.
How to declare foreign savings interest
Regardless of whether you are usually PAYE or self-assessed, you must file a Form 11 in the year that you open a foreign bank account. Each year, you declare foreign interest as part of your annual tax return. Many online savers and investors will need to file using a Form 11.
This includes:
- Total interest earned during the year
- Any foreign tax already deducted
The interest is entered in the foreign income section of your Form 11. PAYE-only individuals with a small amount of foreign savings income may declare it via MyAccount on the Revenue’s website.
Many savers do this after receiving their annual tax statement from Raisin or their savings provider.
Common mistakes to avoid
This is one of the most common areas where mistakes happen.
Here are some key things to watch out for:
- Not declaring the interest
Some savers assume tax has already been handled. If it hasn’t, Revenue may charge interest and penalties later.
- Declaring the wrong amount
You should declare the gross interest earned, not just the amount received after foreign tax.
- Forgetting accounts
If you have multiple savings accounts, all foreign interest must be included.
- Trying to go it alone
Using Raisin for your online savings makes it easy to access the best savings rates for your circumstances and also to keep track of your different accounts. Each year, you’ll be supplied with an end-of-year statement that makes it easy to access your information for tax purposes.
And FastTax.ie is here to help you to take that information and declare it correctly on your Form 11.
Is using Raisin safe?
Yes. Using Raisin and other EU savings platforms is completely safe and legal. Banks available through Raisin are regulated and covered by EU deposit guarantee schemes, protecting deposits up to €100,000 per bank.
The only additional responsibility is declaring your interest correctly for Irish tax purposes. That’s where FastTax.ie comes in!
Why more Raisin savers are using FastTax.ie
Most Raisin users are comfortable managing their savings online. But tax reporting is different. The rules aren’t always as obvious and mistakes can be costly.
FastTax.ie makes it simple.
Our systems will then:
- Calculate the correct tax
- Generate a completed tax return form for online filing
- Tell you what tax payments are due
- Give you peace of mind it’s done properly
Without accountants’ fees or you having to deal with the Revenue yourself.
The smarter way to manage smarter savings
Using platforms like Raisin can help you earn more from your savings. FastTax.ie makes sure you handle the tax side properly.
So you can enjoy the smart savings benefits without the tax stress.
Visit: Raisin to find out more.
Or check out the FastTax.ie plans to see which plan is right for you.
