Double Taxation

[Brendanore]

I declared to the Revenue last year that I had paid Income Tax in Spain on rental income. I understood that my Irish Tax liability would be reduced by the amount I had paid in Spain but the Revenue merely reduced my Irish Income by the amount of the tax paid in Spain thereby only allowing me a portion of that tax against my Irish Income. Surely under the Double taxation rule I should have received credit in full for the income tax paid in Spain ?

 

[Nige]

You are right, your spanish tax should be allowed as a credit against the Irish tax. If all of the Spanish tax cannot be credited (if there is a higher effective rate of tax there) then some if it is allowed as a deduction but this is in addition to a credit.

Did you actually have Irish tax payable on this income?

Is it possible that you just filled out the wrong box in your tax return?

 

[Brendanore]

It's possible I filled out the wrong box but I called to my local Revenue office and they said that the Spanish Tax had been treated correctly by them.
Do you know if there's any way of rectifying this for last year ?