Tax on Income Earned Abroad

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supe

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Hi

I am Irish and currently living in the Middle East where i am earning a tax free salary. I still have a house in Ireland and send money home to pay for the mortgage. I left Ireland on 31 Aug 2008 and have only been back once since then. Does anyone know if I can be taxed in Ireland on the money I send home? I have tried to research the topic on the internet and have searched the revenue website but to be honest I'm still not entirely sure as I find it all a little confusing. Can anyone offer any assistance?

Thank you.
 
Although you were Irish resident in 2008, if you left in August with the intention of being non-resident in 2009, you would have been able to avail of split-year relief, using your full year's tax credits against your 8 months income, and probably getting a refund, depending on your employment and tax history in 2008.
I assume you have returned in 2009 for a short visit only, and would not be resident for 2009, but you are still "ordinarily resident" and as such, remain liable to Irish tax on " remittances", income transferred into Ireland, though earned elsewhere. The mortgage payments are therefore taxable.
You should make an income tax return for 2008.
 
Thanks for the reply Gervan.

I found the following document on the revenue website:-

[broken link removed]

From my reading of this document my understanding of my status is as follows:-

1. I am Not Resident for Tax Purposes : as I have not spent more than 280 days in Ireland in the 2008 and 2009 tax years.
 
Sorry, the above incomplete post was submitted in error and I can't delete it.

Thanks for the reply Gervan.

I found the following document on the Revenue website:-

http://www.revenue.ie/en/tax/it/leaflets/res1.pdf

From my reading of this document my understanding of my status is as follows:-

1. I am Not Resident for Tax Purposes : as I have not spent more than 280 days in Ireland in the 2008 and 2009 tax years.

2. I am Ordinarily Resident : I had been resident in Ireland for the 8 years prior to my departure in August 2008.

3. I am Irish Domiciled : I have a Wife in Ireland, I have a house and mortgage in Ireland and I hope to return to Ireland in a fews years.

So, having determined the above status for myself, table 2.6 (page 5) on the Revenue document linked above states, that the extent of my liability to Irish tax is:-

''Taxable on all Irish and foreign sourced income in full. However, income from the following sources is exempt from tax:

- income from a trade, profession, office or employment, all the duties of which are exercised outside Ireland''.

Therefore, based on all of the above my understanding is that I would not be liable to pay tax on any money I send home for savings, paying the mortgage etc.

Does anyone think I have misunderstood the situation? or that there is something I have missed.

Also, just on a side note. I will be home around Christmas time for a few days and i think I should make an appointment with a qualified professional advisor. Does anyone know of any good financial advisors in the Dublin area?

Thanks.
 
Supe,

You are correct in your interpretation of the Revenue document. For any year you are non resident but ordinarily resident in Ireland (i.e. 2009, 2010 and 2011) you will be liable to Irish income tax on your employment income only if duties are perfromed in Ireland. After 2011 when you will be non resident and non ordinarily resident you will be liable to Irish income tax on Irish source income only. Therefore the remittance basis does not apply in any of these years and funds can be sent back to Ireland without giving rise to any Irish income tax issues.

The remittance basis will only apply when you return to Ireland permanently and become Irish tax resident again. For 3 years after you return you will be liable to Irish income tax on the remittance basis.
 
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