Living in Ireland , working as PAYE in the UK

L

lizzyd66

Guest
I'm hoping someone can point me in the right direction. Since 2003 I have worked on a contract basis with my old company in the UK getting paid gross and declaring my income as self employed to the Irish tax office. It did mean I missed out on my PAYE tax credit. Since November 2006 I'm now back on payroll and am paying UK tax on my earnings. I work an average of 2 days a week, nearly full time term time, school holidays off. I travel to the UK once or twice a month for 3/4 days at a time, rest of the time I work from home in Ireland. I've read the rules for transborder tax relief and don't think I'm entitled to it although the "spirit" of the law fits my case. I'm currently paying NI in the UK but no PRSI over here. I am also paying into the company pension, employer is too. My husband works in Ireland and claims the married person tax credit. Can anyone advise an experienced tax consultant who would be able to help me sort my tax out? I live in North Wicklow but can travel anywhere in the Dublin/Wicklow area. Any help you could give would be much appreciated.
 
I am trying to sort out my daughter's tax position.
She lives in ROI but commutes daily to N.Ireland and thus pays UK tax and Nat Ins. there.
The tax in the UK is higher than it would be here. so she is at a disadavntage.

What are the rules regarding whether she has to pay the higher UK rates or is she entitled to pay the lower ROI rates?

She has received a Transborder Relief and a Personal and PAYE credit which seems effectively to cancel out any sort of refund due. She obviously cannot claim the the PAYE allowance in the UK - but surely she entitled to it here as a refund onher Self Assessment Balancing Statement.

It looks to me that while she received the PAYE tax credit, Revenue here in ROI have reduced the Trans border Relief at the same time.

At the end of the day , in this age of Double Taxation Relief, surely she is entitled to be taxed at ROI rates and thus receive a refund - even though her earnings were all in the UK.
 
If she is carrying out her duties of employment in the UK, she is liable to UK tax and National Insurance on her UK shource income - she will not be entitled to a tax refund if she is claiming her full UK tax reliefs due.

As she is an Irish resident, she is liable to pay Irish tax on her worldwide income, but will then receive a credit for any UK tax paid up to the limit of her Irish tax liability.

This will mean in effect that she pays the highest rate of tax in either UK or Ireland, but not double tax.

Why do you think she is paying more tax in the UK? If she is a higher rate tax payer, the tax bands are much more generous in the UK, and the difference would not be that much surely? - of course this will depend on the level of her income.
 
Thanks Domo for a quick reply

Included in her ROI assessment was a charge of 2% Health Levy on her gross salary. Revenue now say on the phone that this should not have been charged and sorry about that like!

In essence Domo, you are saying that she is liable for the higher of the UK or ROI taxes. Given that she is not a high earner (less than GBP25k) she is entitled to feel a bit peeved at this situation where she is spending on ROI higher priced goods etc while paying higher paye and Nat Ins. and incurring bank and currency charges.
 
if this is such a big issue could she not either move up north and pay cheaper VAT on all her goods (though pay more for her petrol) or get a job here? It's hardly the Revenue's fault, these are the rules, no-one has forced your daughter to take a job in the North.
 
Very unsympathetic and insular reply there Derek

I must tell all my friends in Donegal that they must move house to Derry where they work!

Of course it is Revenue's fault - they are the ones who invented this Transborder Relief in the first place a few years ago!

I thought this site was for discussion by people who have particular problems with the Revenue - and not to just shut up and obey the rules.
 
This is a general tax rule throught the world, based on the tax treaties. It happens just as frequently where people live in Germany and work in France, and in any other adjoining countries where people live in one country and work in another. They then suffer the indirect taxes in the country that they live in (VAT) and income taxes in the country that they work in, with the marginal rate of income tax being the higher of the two countires.

In some situations depending on the tax rates, the income tax rates will be lower in the country that they work in, and indirect taxes lower in the country they live in.

It is not specific to Ireland. I even know of people who live in the north of England and commute to Dublin/Paris etc. to work. They do this from choice - for a better job, or other career related reasons.

Unfortunately we all have to live with the tax rules as they are!
 
Thanks DOMO

But when you are slapped with a 2% health levy on gross earnings, it gets under the skin a bit- however revenue have agreed to cancel this charge as she has already paid stamps in the UK

Which reminds me that I must check with Social Welfare to see if she is still eligible down here.
One last question DOMO if you can help. If she submits a MED form 1 for doctors fees and presciptions etc will she get a refund or will they amend the Trans Border relief to negate a refund?
 
Just submit a MED 1 and they should make a refund based on this.

As she is resident in Ireland she is subject to Irish tax rules on her tax calculations like anyone else.

The foreign tax relief will be restricted to her overall Irish tax liability (net of all relevant claims etc), so she should receive her tax refund like anyone else.
 
Paying NI only

Hi Domo, you seem informed and I seem to have a puzzling scenario which you might be able to shed some light on. I live in Ireland and have recently started work in the UK for a UK company registered in Guernsey. Most of my collegues are living in the UK and are self employed when it comes making tax returns in the UK. We all get paid a gross sum based on a daily rate less national insurance. Can I claim back this national insurance contribution as I will be paying prsi at home when I do my tax declaration or do I benefit in any way by paying this NI. My accountant in Ireland seems to think that I should be getting taxed at source also. I'm puzzled.
 
markbillb,
I would firstly suggest that you speak to the people you are working for, they should clarify exactly how you are being treated for tax and NIC. Based on the limited information provided, I would stab a guess that you are working through an "umberella company". As you are non-UK resident you pay no UK tax, but pay UK NIC

The company can pay you how they wish - if you should indeed be treated as employed and pay tax etc., the company is the one with the problem for non compliance, not you, but, if you have a liability it will need to be paid in due course.

The best thing is to get something in writing from them and then look further into the matter.

www.taxingtimes.ie
 
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