Róisín Shortall (Dublin North West, Independent)
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145. To ask the Minister for Finance the reason accounts in the name of children are subject to Deposit Interest Retention Tax, while those in the name of persons over 65 years of age may qualify for an exemption; and if he will make a statement on the matter. [19745/15]

Michael Noonan (Limerick City, Fine Gael)
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I am informed by the Revenue Commissioners that the legislation governing the operation of Deposit Interest Retention Tax (DIRT) is set out in Chapters 4 and 5 of Part 8 of the Taxes Consolidation Act 1997 (the Act).

Under Section 257 of the Act all deposit takers are obliged to deduct Deposit Interest Retention Tax (DIRT) from payments of interest made to an account unless the account qualifies as an exempt account. There is no specific exemption in the case of interest paid on deposit accounts or on credit union accounts held by children. Such a provision could be difficult and costly to administer, from the point of view of establishing who the beneficial owner of the account is. The tax code does not provide for an exemption from tax for children. 

Regarding individuals aged over 65, since the enactment of the Finance Act 2007, individuals are exempt from Deposit Interest Retention Tax (DIRT) on their interest income provided they or their spouse or civil partner  are aged 65 or over, and their total income in a year (including the interest) is below the annual exemption limit.  

The annual exemption limits for 2015 are as follows:

€18,000 (in the case of a single person) and

€36,000 (in the case of a married couple or civil partnership).

This measure is targeted to provide relief to older people on incomes below the limits mentioned only. It is an income limit and not an allowance. 

There are alternative savings products, offered by the National Treasury Management Agency through An Post,  which are tax free (Savings Bonds, Saving Certificates, Instalment Savings and the National Solidarity Bond).