FAQs – Irish Income Withholding Tax
As an Irish company, Interactive Brokers Ireland Limited (IBIE) is generally required to collect withholding tax (WHT) at a rate of 20% on interest paid to certain clients.
This requirement is set out in section 246 of the Irish Taxes Consolidation Act 1997 and generally applies to interest paid to clients that are:
(i) natural persons resident in Ireland,
(ii) natural persons resident outside Ireland unless the client has successfully applied for an exemption or a reduction in the WHT rate under a Double Tax Treaty (DTT) between Ireland and the person’s country of residence.
(iii) Irish companies
(iv) Companies established in countries with which Ireland has NOT concluded a DTT.
The purpose of this document is to set out our responses to some frequently asked questions (FAQs) on the WHT.
This document is for information purposes only and does not constitute tax, regulatory or any other kind of advice. If you are unsure of your tax obligations please consult the Irish Revenue Commissioners, your local tax authority or an appropriate tax professional.
FAQs
What type of interest does Irish WHT apply to?
Does Irish WHT apply to interest I earn through the Stock Yield Enhancement Program?
If I earn interest through Bond Coupons, am I required to pay Irish WHT?
I do not trade Irish stocks, do I still have to pay Irish WHT?
What is the standard Irish WHT Rate?
When is the 20% WHT applied to my account?
What currency is used for Irish WHT?
I am resident in Ireland. Do I have to pay Irish WHT?
I am not resident in Ireland. Does Irish WHT apply to me?
Does WHT apply to clients who are companies?
How do I apply for an exemption from WHT or a reduced WHT rate?
What do joint account holders need to submit to obtain a WHT exemption/reduction?
Where should I send my completed Form 8-3-6?
How do I submit Form 8-3-6 and supporting documentation to IBIE?
Do I need to apply for an exemption from WHT or a reduction in the WHT rate by a certain deadline?
How do I apply to reclaim WHT applied to my account?
How long does a completed Form 8-3-6 remain valid for?
Do I have to complete a Form 8-3-6? Can I still trade if I don’t complete it?
Where can I see information relating to Irish WHT on my account statement?
How do I know what WHT rate has been agreed between my country of residence and Ireland?
WHT is a set amount of income tax that is withheld at the time income is paid to a person.
Under Irish law, interest payments are considered income. This means that IBIE is legally required to deduct WHT from credit interests on uninvested cash balances in our clients’ securities accounts.
What type of interest does Irish WHT apply to?
Irish WHT applies to credit interest paid to long settled uninvested cash balances as well as short credit interest where you have borrowed stock from IBIE.
Does Irish WHT apply to interest I earn through the Stock Yield Enhancement Program?
No. The interest you earn under the Stock Yield Enhancement Program is not within scope for Irish WHT obligations. Irish WHT only applies to credit interest paid on uninvested cash balances in your account.
If I earn interest through Bond Coupons, am I required to pay Irish WHT?
No. Interest that you earn on Bond Coupons is not within scope for Irish WHT obligations. Irish WHT applies only to credit interest paid on uninvested cash balances in your account.
I do not trade Irish stocks, do I still have to pay Irish WHT?
Yes. If your account is held by IBIE, your account is in scope for Irish WHT on credit interest payments. It is irrelevant whether or not you trade in Irish stocks.
What is the standard Irish WHT Rate?
The standard rate of WHT is 20%. You can find further information on credit interest rates on our webpage.
When is the 20% WHT applied to my account?
If IBIE is required to apply WHT to your interest payments, we will do so at the same time any credit interest is paid to your account.
IBIE pays interest due on the uninvested cash balance in your account on the third business day of the month following the month in which the interest accrued. For example, interest accrued in January will be paid on the third business day in February.
What currency is used for Irish WHT?
Irish WHT is charged in the same currency as the credit interest paid on the uninvested cash balances in your account.
I am resident in Ireland. Do I have to pay Irish WHT?
Yes. Under Irish tax law, all Irish resident individuals and partnerships are subject to 20% WHT on credit interest payments. Irish companies are also subject to WHT, although some limited exemptions may apply.
I am not resident in Ireland. Does Irish WHT apply to me?
Yes, generally Irish WHT applies to natural persons whether or not they reside in Ireland.
However, if Ireland has entered a Double Taxation Treaty (DTT) with your country of residence, that DTA may allow you to apply for an exemption from or reduction in WHT, depending on its terms. Please see further below.
You can find information about Ireland’s DTTs on the Irish Revenue website https://www.revenue.ie/en/tax-professionals/tax-agreements/rates/index.aspx
Does WHT apply to clients who are companies?
WHT does not apply to companies resident in countries that have a DTT with Ireland.
In general, WHT applies to Irish resident companies with a few exceptions, including;
(a) an investment undertaking within the meaning of section 739B of the Taxes Consolidation Act 1997,
(b) interest paid in the State to a qualifying company (within the meaning of section 110).
For a full list of exemptions, please refer to Section 246(3) of the Taxes Consolidation Act.
There is no standard exemption form for corporate clients. In order to avail of these exemptions, clients will have to provide proof of their corporate status requested by IBIE.
How do I apply for an exemption from WHT or a reduced WHT rate?
If you wish to apply for a WHT exemption or reduction under the terms of a DTT, you should complete Form 8-3-6, and return that Form to IBIE.
The following is a summary of the information you must provide when completing Form 8-3-6:
1. Your name (please ensure this matches the name on your IBKR account)
2. Your address
3. Your tax reference number in country of residence
4. The country in which you are tax resident
5. The WHT rate agreed between your country of tax residence and Ireland (see FAQ on this topic).
6. Signature.
7. Date.
You must request your local Tax Authority to sign and stamp Form 8-3-6 before returning it to us.
For more detailed information on how to complete Form 8-3-6, please refer to the Irish Revenue Commissioners’ website here https://www.revenue.ie/en/companies-and-charities/financial-services/withholding-tax-interest-payments/index.aspx
If you have asked your local tax authority to sign Form 8-3-6 and they have refused, you can instead submit a Tax Residency Certificate (TRC) from your local Tax Authority, with a completed Form 8-3-6 that has not been signed and stamped by your local tax authority. Revenue introduced this possibility in January 2023, after being informed by IBIE of the difficulties clients were experiencing in completing the Form.
To be acceptable, the TRC must explicitly state that you are tax resident in your country of residence in accordance with the relevant provision of the double taxation treaty between Ireland and your country of residence.
Please note that a TRC will only be accepted where you have first requested your local tax authority to sign and stamp Form 8-3-6 and it has refused to do so or has failed to do so within a reasonable time.
Form 8-3-6 and information about completing the Form 8-3-6 is available on the website of the Irish Revenue Commissioners.
To assist you, IBIE has also prepared a number of versions of Form 8-3-6 with certain information pre-filled, depending on your jurisdiction of tax residency. You can select the most appropriate form from the list below.
Form 8-3-6 has been translated into French, German, Spanish, Italian and Dutch*
1. EEA countries with 0% Withholding Tax.
2. EEA countries with rates above 0% Withholding Tax.
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3. Other countries with a DTA with Ireland (* denotes where there is 0% withholding tax in all situations).
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Georgia |
Moldova |
Singapore |
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Armenia |
Ghana |
Montenegro |
South Africa* |
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Australia |
Hong Kong |
Morocco |
South Korea* |
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Bahrain* |
India |
New Zealand |
Switzerland* |
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Belarus |
Israel |
North Macedonia* |
Thailand |
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Bosnia & Herzegovina* |
Japan |
Norway |
Turkey |
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Botswana |
Kazakhstan |
Pakistan |
Ukraine |
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Canada |
Kenya |
Panama |
United Arab Emirates* |
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Chile |
Kosovo |
Qatar* |
United Kingdom* |
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China |
Kuwait* |
Russian Federation* |
United States of America* |
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Egypt |
Malaysia |
Saudi Arabia* |
Uzbekistan |
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Ethiopia |
Mexico |
Serbia |
Vietnam |
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Zambia* |
What do joint account holders need to submit to obtain a WHT exemption/reduction?
Each account holder in a joint account needs to complete their own documentation. This means that a separate Form 8-3-6 must be completed by each account holder and (if relevant) a separate TRC must be provided by each account holder.
Where should I send my completed Form 8-3-6?
You should send your completed Form to IBIE. You should NOT send the Form to Irish Revenue.
How do I submit Form 8-3-6 and supporting documentation to IBIE?
You should email a PDF or JPEG copy of the signed form to tax-withholding@interactivebrokers.com. If you have not been able to obtain a stamp from your local tax authority, please ensure that you also email your Tax Residency Certificate (TRC) to this same email address.
Alternatively, you can upload your signed Form 8-3-6 to your Client Portal through the ‘Document Submission Task’ tab. However, if you are submitting a TRC with your Form you will still need to send this separately to the above email address.
Please put your IBIE account number in the email subject line in all email correspondence. A failure to do so may delay or prevent the processing of your application,
If your submitted documentation is in order, IBIE will send you a confirmation email stating that your Form has been received and processed.
If your submitted documentation is not in order, we will send you an email setting out the additional information or documentation we require to process your application.
Please follow up with IBIE if you have not heard from us within four weeks.
Do I need to apply for an exemption from WHT or a reduction in the WHT rate by a certain deadline?
There is no deadline. However, for applications made in 2023, a WHT exemption or rate reduction will only apply to interest payments made after IBIE has received a complete application.
If we have not processed your Form 8-3-6 by the time the next interest payment is made to your account we will refund any WHT deducted after the date we received your application. Refunds will be visible in the Withholding Tax section of a statement.
Yes, if you are not subject to WHT, or are subject to a reduced WHT rate by virtue of a Double Taxation Treaty between Ireland and your country of residence, you will be entitled to reclaim WHT paid in excess of the WHT rate set out in the DTT.
How do I apply to reclaim WHT applied to my account?
Generally, the application process (i) to apply for an exemption from WHT or a reduction in the WHT rate going forward and (ii) to reclaim WHT already charged, are two separate processes. IBIE is awaiting full details from the Irish Revenue Authority on how clients can make reclaims on WHT and will make these details available once provided.
However, for 2022, Revenue has agreed to allow a completed Form 8-3-6 (signed and stamped by the relevant Tax Authority) received by IBIE before 31 December 2022, to be used to reclaim WHT applied in 2022. This means that if IBIE received a completed form from you on or before 31 December 2022 and WHT was applied to your account from January – December 2022, IBIE will refund all or part of that WHT, depending on Ireland’s arrangements with your tax jurisdiction.
If you did not provide a Form 8-3-6 before 31 December 2022 or, if you provided a Form 8-3-6 but it was incomplete (for example by not being stamped by your local tax authority), you must separately apply for a full or partial reclaim of WHT paid in 2022 and 2023. Further details on the reclaim process may be found in an article titled Irish Tax Withholding Reclaim Process. For your convenience, the full article may be viewed here.
How long does a completed Form 8-3-6 remain valid for?
A fully completed Form 8-3-6 remains valid for 5 years unless there is a material change in your facts and circumstances. This also applies if you have provided IBIE with a TRC in lieu of having your Form 8-3-6 stamped by your local tax authority. If there is a material change to your circumstances from a tax perspective, you must advise IBIE immediately and provide an updated Form 8-3-6 where appropriate. For example, if you move tax residency from one country to another, you should advise IBIE and provide IBIE with a Form 8-3-6, signed and stamped by your local tax authority from your new country of residence.
Do I have to complete a Form 8-3-6? Can I still trade if I don’t complete it?
You do not have to complete Form 8-3-6 and you will still be able to trade if you do not complete the form.
However, if you do not complete Form 8-3-6 IBIE must continue to deduct WHT at a rate of 20% from the credit interest earned on cash balances in your account.
Where can I see information relating to Irish WHT on my account statement?
You can review information relating to Irish WHT in the ‘Withholding Tax’ section of your monthly account activity statement.
You can also view this information in your daily statement on the 3rd business day of the month (when credit interest is paid).
Please see the IBIE website here for more information: https://www.interactivebrokers.ie/en/index.php?f=46788
How do I know what WHT rate has been agreed between my country of residence and Ireland?
This information is available from the Irish Revenue Commissioners and/or your own local tax authority. However, in order to assist you, IBIE has also prepared a list of Irish WHT information by jurisdiction below.
By clicking on the country below, it will bring you to the relevant Form 8-3-6.
*Form 8-3-6 has been translated into French, German, Spanish, Italian and Dutch*
1. EEA countries with 0% Withholding Tax.
2. EEA countries with rates above 0% Withholding Tax.
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|
3. Other countries with a DTA with Ireland (* denotes where there is 0% withholding tax in all situations).
|
Georgia |
Moldova |
Singapore |
|
|
Armenia |
Ghana |
Montenegro |
South Africa* |
|
Australia |
Hong Kong |
Morocco |
South Korea* |
|
Bahrain* |
India |
New Zealand |
Switzerland* |
|
Belarus |
Israel |
North Macedonia* |
Thailand |
|
Bosnia & Herzegovina* |
Japan |
Norway |
Turkey |
|
Botswana |
Kazakhstan |
Pakistan |
Ukraine |
|
Canada |
Kenya |
Panama |
United Arab Emirates* |
|
Chile |
Kosovo |
Qatar* |
United Kingdom* |
|
China |
Kuwait* |
Russian Federation* |
United States of America* |
|
Egypt |
Malaysia |
Saudi Arabia* |
Uzbekistan |
|
Ethiopia |
Mexico |
Serbia |
Vietnam |
|
|
|
|
Zambia* |