Tax on foreign investment

I

irash

Registered User
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86
Hi, sorry if this question has already been asked here...
If an Irish citizen and resident has a property in US, which is being rented out, does he have to pay any tax on income he is getting from that to the Revenue here in Ireland, besides what he pays in US?
 
Yes, he has to declare the property and pay tax on the Rental profit in Ireland on the same basis that the property was in Ireland
See Revenue guide to rental income and
[broken link removed]

He can offset the tax paid in US against tax paid in Ireland in relation to the property.
 
Thank you very much for the answer.
But it still remains unclear to me whether "offset" means that tax has to be paid in USA only, and after that the US imcome has to be declared in Ireland, but no tax in Ireland will be due
OR that the amount of tax paid in US in deductible from the profit made along with all other expenses, and tax on remaining sum of profit has to be paid in Ireland. In this case it looks like double taxation

Forgive me for my lack of understanding here.
 
Offset means that any tax paid in US is deducted from tax bill in ireland (you calculate the tax bill in US and pay taxes accordingly in the US. You then have to calculate the tax bill in Ireand under irish law (see above). The tax paid in US can be deducted from any tax paid in Ireland.

Not sure how the situation is in the US but lets assume the tax due is USD 2000 or say 1500 Euro.

In Ireland
(All figures converted to Euro)
Rental Income .............................................15,000
Less interest on Mortgage ....................8000
.......Wear & Tear Furniture/Fittings etc ..1000
.......Other Expenses............................1000
Total Expenses ............................................10,000
Total Profit ...................................................5,000
Tax @ 41% ...................................................2,050
Less tax paid in US .........................................1,500
Tax due in Ireland .............................................450
 
2050 mins 1500 is 550, not 450.


asdfg said:
Offset means that any tax paid in US is deducted from tax bill in ireland (you calculate the tax bill in US and pay taxes accordingly in the US. You then have to calculate the tax bill in Ireand under irish law (see above). The tax paid in US can be deducted from any tax paid in Ireland.

Not sure how the situation is in the US but lets assume the tax due is USD 2000 or say 1500 Euro.

In Ireland
(All figures converted to Euro)
Rental Income .............................................15,000
Less interest on Mortgage ....................8000
.......Wear & Tear Furniture/Fittings etc ..1000
.......Other Expenses............................1000
Total Expenses ............................................10,000
Total Profit ...................................................5,000
Tax @ 41% ...................................................2,050
Less tax paid in US .........................................1,500
Tax due in Ireland .............................................450
Click to expand...
 
asdfg, thank you very much indeed. Your explanation is very comprehensive. It made me feel much better.
Just one more thing to clarify is the rate of tax: if our combined income PLUS income from this rental is still within 44,000 SRCOP, will this mean that we pay tax on rental income at standard 20%, or PAYE and this rental income are two different things, and tax on rental income is calculated at 41% in any event?
Thanks again. I promise not to ask more silly questions
 
Rental income is added to your PAYE income and taxed accordingly. If as you say your combined income PLUS income from this rental is still within 44,000 SRCOP, you will be taxed at 20%
 
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