Saving in Ireland (2026): DIRT, State Savings & How Your Money Grows
Working out how your savings will grow in Ireland means dealing with one thing most calculators ignore: DIRT, the tax on deposit interest. Get the tax right and the picture changes — a "tax-free" State Savings product paying 2% can beat a bank account paying nearly 3%. Here's how Irish savings tax works and how to project real, after-tax growth.
DIRT: the 33% tax on deposit interest
Deposit Interest Retention Tax (DIRT) is deducted at source — automatically, before the interest reaches you — from savings held with Irish banks, credit unions and An Post. The rate is 33% (2026). So if a bank account pays €100 of interest, €33 goes to Revenue and you keep €67.
- It applies to ordinary deposit/savings accounts and most fixed-term deposits.
- It does not apply to current accounts that pay no interest, or to the DIRT-free products below.
- PRSI may also apply to deposit interest for some people, separately from DIRT.
The DIRT-free options: An Post State Savings
The Irish State Savings range, run by An Post for the National Treasury Management Agency, is completely DIRT-free — the return you're quoted is the return you keep:
- Savings Certificates and Savings Bonds — fixed-term, fixed-return, tax-free.
- National Solidarity Bonds — longer term, tax-free.
- Prize Bonds — no interest, but tax-free prize draws instead.
Because there's no DIRT, the comparison isn't apples to apples with a bank rate. A rule of thumb: a tax-free 2% is roughly equivalent to a taxable ~3% once 33% DIRT is taken off.
The over-65 exemption
If you (or your spouse/civil partner) are 65 or over, you can receive deposit interest without DIRT — provided your total income for the year is below the annual exemption limit. You claim this by completing a declaration with your financial institution. There's also an exemption for certain permanently incapacitated people.
How to project real, after-tax growth
The maths that matters is compound growth on the after-tax rate. To estimate it:
- Take your headline rate (say 3%).
- If the account is taxable, multiply the interest by 0.67 (after 33% DIRT) → an effective ~2%.
- Compound that effective rate over your time horizon.
Inflation matters too. If your after-DIRT return is 2% and inflation is 2%, your money is standing still in real terms. For long horizons (5+ years), many savers in Ireland look beyond deposits to diversified investments — but those carry risk and different tax (exit tax / CGT), so weigh it carefully.
Project your savings growth
Use the compound interest calculator to see how regular saving grows over time — then apply the DIRT haircut above for a realistic after-tax figure.
Try the Compound Interest Calculator →Frequently asked questions
What is DIRT?
A 33% tax deducted at source on deposit interest from Irish banks, credit unions and An Post.
How do I avoid it?
Use An Post State Savings (all DIRT-free), or claim the over-65 exemption if your income is below the limit.
How much will my savings grow?
Compound your after-DIRT rate. A taxable 3% nets ~2%; a tax-free State Savings 2% is roughly equivalent.
Related
Sources
- Revenue.ie — Deposit Interest Retention Tax (rate, exemptions)
- Citizens Information — DIRT and the over-65 exemption
- StateSavings.ie — DIRT-free State Savings products
Figures as of 2026 (DIRT 33%). Rates and exemption limits can change in the Budget — verify on revenue.ie and statesavings.ie. General information, not regulated financial advice.
Cite this article
Randive, A. (2026). Saving in Ireland (2026): DIRT, State Savings & How Your Money Grows. DecisionsCalc. https://decisionscalc.com/articles/ireland-savings-dirt-guide/