Taxes Consolidation Act 1997 section 267C

Taxation of dividends on special term share accounts

Section 267C provides for annual tax exemptions on dividends paid on special term share accounts held in credit unions, and sets out the consequences where an account loses its special term status.

• Dividends on a medium term share account (3 years) are exempt from income tax up to €480 per tax year; dividends on a long term share account (5 years) are exempt up to €635 per tax year.
• A credit union member may elect in writing to convert a medium term account to a long term account, with the higher €635 exemption applying from the next tax year commencing on or after the date of the election.
• If an account fails to meet the required conditions, it loses its special term status and all dividends — past and future — become subject to DIRT, with the credit union required to deduct the tax due.
• No new special term share accounts could be opened on or after 16 October 2013, so the provisions apply only to accounts that were still within their qualifying period on that date.