Commuter to London

Hi,

I work in London from Monday to Friday - Leave Dublin on Monday morning and get back by Friday afternoon.

As I am employed by an Irish Company - for the last 8 months - I have paid Irish tax. Recently, I have been told that I now need to register and pay tax in the UK as I have been there for more than 183 days.

Do I really need to do this ? What are the implications re Pension ? etc?

I have read the revenue sites both in Ireland and England and they are quiet grey in their information? Any other sources of information? Anyone know an accountant that is KNOWLEDGEABLE in this area? NOT an accountant that reads the Revenue site! Someone who works in this area and knows the rules?

Email is bloodytax@hotmail.com

Thanks.

John

John,

Actually it is your employer who has the obligation to operate UK PAYE on your income. He should be doing this, and you should point it out to them.

However, if your employer does not operate PAYE, you do still have a UK tax liability as the income was earned in the UK, and you will need to file a UK tax return.

As you will probably still be resident in Ireland you will be liable to Irihs tax on this income with a credit for the UK tax paid.

The main problem I see is to do with your PRSI/UK National Insurance contributions.

Take this matter up with your employer in the first instance, but you can contact me if you want more information.

I have dealt with many of these matters, although, as I said it is really the employer who needs to sort it out.

Thank you for your reply.

Yes, you are right, I also believe that my employer should be helping me with this as they are PAYE and I am paying full Irish PAYE and PRSI at present. However, they are bending over backwards to fob me off when I brought this up and their only suggestion to date is that I do need to declare in the UK and I should sort that out myself. I feel like I have tripped on to something here that they are afraid of but I have no idea what that could be!

The only advice I have to date, I got down the pub from an accountant and their best advice is that I should do nothing as the HM Revenue will never find me and even if they did, I am paying full and fair tax to Ireland so although some extra paperwork would be involved, I should not get penalized..

So, I have decided to wait at least one week, see what other if any responses I get here from similar bodies, ask some more people and make a decision next week.

Depending on what your company is doing (or you are doing for them in the UK), they may have Corporate Tax liabilities in the UK as well as Ireland.

They are probably hiding their heads in the sand about this, and that is not a sensible thing to do.

As you are likely to be resident in the UK, you are legally responsible for declaring your income there (whether or not the tax man finds out). You should also be paying UK Social Security. It is very likely that you will be found out at some point.

However, your employer also has a legal responsibility to operate UK PAYE and NIC on your salary, and this could cause problems for them.

The UK Government are losing out on your Tax and NIC, and they will pursue this if they find out. Although you are paying full and fair tax in Ireland, the UK Government don't care about that - they want you to pay your tax there. In Ireland, as I stated above, if you have a liability, you get credit for UK tax paid - not the other way around.

The last case I had of this, was in the opposite direction - worker in Ireland being paid by UK company they operated UK PAYE and were refusing to operate Irish PAYE which they were obliged to do- he eventually got his company to agree to sort the position out, although I believe it took a lot of persuasion on his part.

I'd like to open this up again as I have returned to the UK to work again and what I know from talking to other people whom work here (from Ireland) is - In their view there are a number of key factors which determine where you should pay tax and they are - (based on being a PAYE employee of an irish company). -
1. Where is your home / house and family - is that in Ireland? if so - pay in Ireland.
2. How many days did you work in the UK - counted as nights in the UK at midnight? Less than 183 and you are deemed non-resident for UK tax.
3. You don't have to pay N.I. in UK if your company submits an E101 to the UK Tax office.
4. If you are 183 days in Ireland for 1 year or 280 days for two tax years - you must pay tax in Ireland.
5. Provided you pay full tax plus levi's and PRSI in one jurisdiction, i.e Ireland, you should be ok in the other jurisdiction provided you meet the (less than) 183 day rule.
6. In all cases, they recommend if you have any queries to go to both tax regimes and explain to them what exactly you are doing.They all found the tax offices were helpful.
7. Finally, if there is any reason to submit a tax return , i.e longer than 183 days in UK - then the end of year returns will simply equate the difference?

Do you agree?

Here are some comments on the above:

1) Your days in Ireland determine your Irish residence status, and therefore you taxability in Ireland - not where your home/family is
2) 183 days is not the only rule to determine UK residence - if you average 91 days or more a year in the UK you can be UK resident. If employed by an Irish company but working 60 days a year or more in the UK then the company is obliged to operate UK PAYE on your salary - this can be a complex issue
3) that is correct, but you may not wish to remain in Irish social security, so this is just an option
4) your domicile could affect this depending on the source of the income
5) Social security is governed by a different set of rules than tax, so separate advice needed - social security can depend on "ordinary residence" rather than tax residence
6) the Revenue may not be so helpful if your situation is complex
7) don't really understand the comment

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