Dividend or salary
With a dividend, the total burden is 14.5% (10% + 5% on the remainder). Paying yourself as owner-manager under a management contract triggers ~32.7% social security up to the maximum income of €2,300 plus 10% tax — more expensive, but it gives social security entitlement and is a recognised company expense. The optimal combination is usually: self-employed social security on a chosen income, plus a dividend for the rest.
When a dividend can be distributed
After approval of the annual financial statements — for profit from prior years — or in the interim, based on an interim balance sheet. It cannot be distributed if net assets would fall below capital plus reserves as a result (Art. 133 of the Commerce Act). Distribution without documents and a formal decision is a hidden distribution, carrying a 20% penalty.
Deadlines and documents
| Step | Deadline | Document |
|---|---|---|
| Distribution decision | after approved annual statements or interim balance sheet | owner's minutes/decision |
| Withholding the 5% tax | at payment | payment order to the owner with tax withheld |
| Payment to the National Revenue Agency | by the end of the month after the quarter | payment code 11 00 00 |
| Declaring | same deadline | declaration under Art. 55 PITA / Art. 201 CITA |
| For foreign owners | under a double-tax treaty — a request to apply it | certificate of tax residence |
More on 5% vs 10% and hidden distribution: Dividend tax: when it's 5% and when it's 10%. All rates in one place: Taxes 2026.
Sources
Corporate Income Tax Act Art. 20, 194; Personal Income Tax Act Art. 38, 65; Commerce Act Art. 133. Verified 3 September 2026. Results are indicative.