Irish Tax on Foreign Rental Income

  • Thread starter Deleted member 58475
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Deleted member 58475

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I'm trying to figure out how Irish income tax is calculated on my foreign rental income. I am in receipt of a company pension, so my principal income is paid monthly via PAYE and at source.
Every year, I go onto ROS and fill in all my tax details (including tax already paid in the country where I receive the rental income) for the previous year, including my foreign rental income.
I assumed that having paid tax on my pension, then all that was due was the tax on the rental income. When I got my tax demand, I could not figure it out at all.
Is there a simple formula that I can apply, so that I can calculate the additional tax due (before I submit via ROS).

T
 
I'd put in your pension details first, it's hard to advise without figures but the state pension does not have PAYE applied to it at source. So your company pension has to be adjusted to cater for this. Do you earn over the exemption limit from your company pension and state pension? Does marginal relief apply?

When you add the foreign rents to your pensions does it take you over the limit.

If Ireland has a double Taxation Treaty then you will get credit for the foreign tax but only to the extend that you pay Irish tax.
 
Thanks Joe 90.

Firstly, I'm 60 years of age, so no state pension applies. I have a company pension, but I am not deducted PRSI (I took early retirement a few years ago)

I'm assuming I earn over the exemption limit on my pension.

I don't know what marginal relief means.

I pay tax firstly in the country where I receive the rental income and there is a double tax treaty.

I'm really looking for a simple formula that I can put in a spreadsheet and calculate my tax liability (on the rental income only, as I assume everything else is fine, as it is PAYE) before I enter it into ROS (by the way, is ROS the correct place to do this and what form should I use?)
T
 
Well if you put the pension details into ROS and it balances then the tax is sorted on that.

There is a formula to compute the double tax relief but I'm not sure it's simple. If the foreign tax suffered is lower than the Irish effective rate then you should get the full amount of foreign tax suffered as a credit.

If the foreign tax suffered is higher than the Irish effective then the foreign net income is regressed at the Irish effective rate and the credit for foreign tax is less than the foreign tax suffered.
 
Can anybody tell me how double taxation relief is calculated?

T
 
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