Domicile/Residency and transborder relief question

I am about to go on to a working abroad adventure I am trying to understand how much tax I will be paying. The first question that arises and that is fairly significant in terms of Irish tax liability is around residency and domicile.

Hope somebody can shed some light...

Situation is as follows.

I have been living in Ireland since 2000 ( I am a EU foreign national), bought a house in 2005 and have been working for an Irish branch of a multinational company. I have married a Northern Irish girl.

I have now been asked to go work for the Polish branch of the same multinational for a year, starting Oct 1st. I will get my salary paid in Poland and taxes and social contributions will be withheld there.

According to Polish law I will be considered a resident in 2013 if I spend 183 days or more in the country in one year, which I will in 2013.
According to Irish law I will be considered a resident in 2013 if I spend more than 280 days in Ireland during 2012 and 2013, which will also be the case.


According to the Irish-Polish Tax treaty :

Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his status shall be determined as follows:
1. he shall be deemed to be a resident of the State in which he has a permanent home available to him; if he has a permanent home available to him in both States, he shall be deemed to be a resident of the State with which his personal and economic relations are closer (centre of vital interests); I would be renting a house in Poland, so I would have permanent homes available in both states. Sure I would have my family in Ireland (personal relations) but my place of work is Poland (economic relation)
2. if the State in which he has his centre of vital interests cannot be determined, or if he has not a permanent home available to him in either State, he shall be deemed to be a resident of the State in which he has an habitual abode; N/A
3. if he has an habitual abode in both States or in neither of them, he shall be deemed to be a resident of the State of which he is a national; N/A I am a national of neither country
4. if he is a national of both States or of neither of them, the competent authorities of the Contracting States shall settle the question by mutual agreement. How ????



Where is my domicile ? Would it be my native country , or has it now changed to Ireland as I have married and bought a house? My intention was never to stay here forever, but due to negative equity I am not sure whether I actually have a choice of leaving this country for good any time soon.

Have a look at this link which hopefully can answer your question.

My understanding is that Ireland is your ordinary domocile, you have lived here for more than 3 years and have strong ties ( like owning a house)

When you move to Poland, poland is your residence, but Ireland remains your
country of ordinary domocile.

http://www.citizensinformation.ie/e...on/tax_residence_and_domicile_in_ireland.html

Happy_Harry said:

Situation is as follows.

I have been living in Ireland since 2000 ( I am a EU foreign national), bought a house in 2005 and have been working for an Irish branch of a multinational company. I have married a Northern Irish girl

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Does she have an Irish passport?

Happy_Harry said:

I have now been asked to go work for the Polish branch of the same multinational for a year, starting Oct 1st. I will get my salary paid in Poland and taxes and social contributions will be withheld there.

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All of the above points are very relevant ones.

Happy_Harry said:

1. he shall be deemed to be a resident of the State in which he has a permanent home available to him; if he has a permanent home available to him in both States, he shall be deemed to be a resident of the State with which his personal and economic relations are closer (centre of vital interests); I would be renting a house in Poland, so I would have permanent homes available in both states. Sure I would have my family in Ireland (personal relations) but my place of work is Poland (economic relation).

Click to expand...

Clearly based on all of the above points Ireland is your centre of vital interests, based on all of the above points. Question for you to illustrate the point: If your employer went bust while you're in Poland, would you stay there or return to Ireland...?

Your Domicile is normally the country where you were born, where your parents and family were born, and where you were educated and allowing for provisions where a person would be buried if they died.

It is not easy to change ones dmocile and can have serious tax implications. Consult a tax expert.

Just because you are born in Ireland and have an Irish passport it does not mean you are domiciled in Ireland.

Time said:

Just because you are born in Ireland and have an Irish passport it does not mean you are domiciled in Ireland.

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Not sure if that's in response to my question about OP's wife.

My response was in relation to residency only, and establishing the OP's centre of vital interests for residency purposes.

mandelbrot said:

Does she have an Irish passport?

Clearly based on all of the above points Ireland is your centre of vital interests, based on all of the above points. Question for you to illustrate the point: If your employer went bust while you're in Poland, would you stay there or return to Ireland...?

Click to expand...

She has UK and Irish passport yes

My employer will not go bust, but if it would I would probably go look for a job outside Ireland

mercman said:

Your Domicile is normally the country where you were born, where your parents and family were born, and where you were educated and allowing for provisions where a person would be buried if they died.

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I was born in the same country as my parents , I was educated there and I hold an insurance in that country that would arrange my burial. Having said that I have not specified where I would like to be buried.

The domicile question may well be relevant as I would probably agree that I will be Irish resident for tax purposes -

Resident and ordinarily resident
but not Irish domiciled :
Taxable on Irish sourced income in full and taxable on
remittances of foreign sourced income.

I am not quite sure what "remittances" means.Any help on that would be much appreciated.

Happy_Harry said:

She has UK and Irish passport yes

My employer will not go bust, but if it would I would probably go look for a job outside Ireland



I was born in the same country as my parents , I was educated there and I hold an insurance in that country that would arrange my burial. Having said that I have not specified where I would like to be buried.

The domicile question may well be relevant as I would probably agree that I will be Irish resident for tax purposes -

Resident and ordinarily resident
but not Irish domiciled :
Taxable on Irish sourced income in full and taxable on
remittances of foreign sourced income.

I am not quite sure what "remittances" means.Any help on that would be much appreciated.

Click to expand...

Remittances basically are money earned abroad that is remitted (sent back) to Ireland.

OK, upon reading a bit more it seems that I could avail of the Transborder Relief and the whole question of residency and domicile becomes less significant.
I am intending to travel back every second weekend, by arriving on Friday I will be here in week 1, and by leaving on Monday I will be here in week 2 so satisfying the weekly commuting rule. Out of interest , when does a week start ( Sunday or Monday ? As there may be days I would have to travel back on Sunday).

How does this transborder relief work if I would start Oct 1st in Poland ? I would satisfy the 13 week rule, but how will it affect the amount of tax paid for 2012 ?
I have obviously paid tax through PAYE and will continue doing so till Sept 30. The amount of tax and PRSI/USC is based on yearly credits, so if I would only pay Irish tax for 9 months, it will be likely I have overpaid somewhat ?
Does anyone have experience with transborder relief and how to claim it ? Is it painful (as in proving you were commuting?), do you need to let revenue know in advance ? I need a certificate from Poland that I will have paid tax to submit with my self assessment, what if I don't get the certificate on time ?