# Working for and getting paid from a UK company, working from home in Ireland



## dazzerb

I have an opportunity to move to Ireland and work from home working for a UK company.  The UK company has no offices or businesses in Ireland so no ability to pay from here.

How might this work? I assume I would need to pay Irish taxes but UK company would have no way to withhold them I assume.   Do I need to pay any UK taxes?  Also can they pay me in sterling and not withhold anything and I just take care of the taxes myself in Ireland.

I assume this is a common situation and I googled a bit but not finding anything.

One option would be for me to quit and work as a private contractor and just invoice them monthly.

What other options might I have?

Thanks for your help.


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## number7

I supply services to uk companies.

I am an irish business and pay my tax in ireland. The uk companies pay me the total amounts owed directly in account and do not withhold any monies.

My understanding is that witholding taxs is designed to protect the revenue from non payment, as you will have no liability to the uk revenue then there is no case for WT.

I have bank accounts in NI and they pay into there to allow me somne control on the exchange rates and the timing of that exchange.


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## Breninio

dazzerb, correct me if I'm wrong, but I think your case may be more complicated by the fact that you sound as if you are an employee of the UK company and not a self employed individual in business in your own right who happens to be providing services to this UK company.

If you are an employee of the UK company who is going to move to Ireland and provide services exckusively to the UK company and under directioon from that company then there are Irish tax issues for the company to consider. 

For example, depending on the work you are carrying out here, you may create a permanent establishment for the UK co in Ireland aand the company may come within the charge to Irish corporation tax. 

Also, if you are an employee of the UK company and based pretty much full time in Ireland then the UK company will need to operate Irish PAYE on your salary.

These are just two of the issues but I think it would certainly be worthwhile getting professional advice, probably more for the UK co than you.


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## steve1234

Sorry for butting in on your thread..
I've got a similar issue with an added twist. Im irish just about to start contracting work for a UK company but living in New zealand. Im not sure whether i should set up a company in New zealand, UK or set up an irish company to invoice from. Any thoughts? Im on a 1 year working holiday visa in nz so im not sure if im even allowed to set up a company here in new zealand.


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## podowd

dazzerb said:


> I have an opportunity to move to Ireland and work from home working for a UK company. The UK company has no offices or businesses in Ireland so no ability to pay from here.
> 
> How might this work? I assume I would need to pay Irish taxes but UK company would have no way to withhold them I assume. Do I need to pay any UK taxes? Also can they pay me in sterling and not withhold anything and I just take care of the taxes myself in Ireland.
> 
> I assume this is a common situation and I googled a bit but not finding anything.
> 
> One option would be for me to quit and work as a private contractor and just invoice them monthly.
> 
> What other options might I have?
> 
> Thanks for your help.


 
As an employee carrying out your duties in Ireland you should be paying tax under the PAYE system in Ireland. Your UK employer should register with the CRO as a foreign company and then register with Revenue as an employer. They can then operate Irish PAYE on your salary. 

It's not as complicated as it sounds, relatively straightforward process (but can take CRO/Revenue a few months to process it). 

The other alternative is for you to set up your own Irish company and invoice them as a contractor, but in that case you're losing all your accumulated employee rights/benefits so that may not suit you. 

In theory you could invoice them as a sole-trader but the Irish revenue may not accept that you are genuinely self-employed, and while your taxes may be correct you would not be paying the correct PRSI. 

Regards

podowd
http://www.prima.ie


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## podowd

steve1234 said:


> Sorry for butting in on your thread..
> I've got a similar issue with an added twist. Im irish just about to start contracting work for a UK company but living in New zealand. Im not sure whether i should set up a company in New zealand, UK or set up an irish company to invoice from. Any thoughts? Im on a 1 year working holiday visa in nz so im not sure if im even allowed to set up a company here in new zealand.


 
I don't know what the NZ rules are, but if they are the same as Ireland (which would be my guess) your visa won't permit you to set up a business, either as a company or as a sole trader. Working Holiday visas usually only allow you to be employed by a company, so you may need to use a local umbrella company provider for your contract

Regards

podowd
www.prima.ie


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## dazzerb

number7 - I assume you have your own company or work as a private contractor.  Your situation is definitely an option for me but I would have to quit the job and work for myself.  This is not necessarily a issue for me.  The company however would prefer if I remain an employee.   Do you have any issues moving money from NI and ROI banks or do you just use your NI bank as your normal bank?

I think Breninio is correct when he advises me of the company to seeking professional tax advise.   I want to make move as easy and hassle free on the UK company so they do not change their mind!!!

steve1234 - no problem butting in.  Would like to hear how your situation works out too.

Thanks everyone.


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## What the

A company I worked for had 2 UK based employees previously but we have no UK presence. We simply hired a payroll company in the UK at a minimal cost to process the payroll for these 2 and tell us what taxes to pay and when. I assume this could easily be done the other way around to suit your situation.


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## Breninio

If there were two employees of the company operating from a fixed place of business in the UK (this could be an office at home, or a client site i.e. it does not have to be aproperty owened or leased by the employer in the UK)) on a long term basis then it is very likely that a permanenet establishment was created in the UK. There are some exceptions (i.e. if the duties carried out in the UK related exclusively to preparatory, auxilliary duties). However other than that I don't see how a permanent establishment was avoided in the UK.


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## Lochy

Hi dazzerb,

My wife did exactly the same thing when we moved back from the UK to Ireland, She continued to work and get paid through the UK, but worked from home in Ireland. It is relatively simple to sort out.

1. Contact your local revenue office. They will treat you as self employed. In the meantime continue to pay tax in the UK through PAYE as normal. 
2. At the end of the year fill in your tax return detailing exactly what tax you paid in the UK.
3. The revenue will calculate your Irish tax liability by working out what tax you would have paid on your earnings if you had earned the same amount in ireland. They will take away any tax you paid in the UK as there is a double taxation agreement. You then pay the balance. We found we had to pay more, but this depends on your own situation.
4. You will pay national Insurance in the UK, so no matter what revenue tell you, you do NOT have to pay PRSI or Health Levy. It took us 3 appeals for them to agree that this was the case.
5. I have a good accountant who knows how to fill in the tax return for this scenario, and knows the rules on Health Levy and PRSI even when some people in revenue do not. PM me if you want details. He can work by email/scanning etc so it doesn't matter where you are.

Lochy


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## Breninio

Lochy said:


> It is relatively simple to sort out.


 
Everything is simple to sort out if you ignore any of the complicating factors! If your wife returned to Ireland, remained employed by the UK company (although now carried out duties full time for that UK company in Ireland) then she was not self employed, she was an employee of the UK company carrying out duties in Ireland. If she was a contractor providing services to this UK comapny as well as other clients then it is a different story, however if UK PAYE continued to be operated this does not seem to be the case. If your wife returned to Ireland post 2006 then Irish PAYE should have been operated. Also, irrespective of when your wife returned, then there would certainly be Irish corporation tax issues for the company to consider. As I say, tax is very simple when you choose the simple route rather than the correct one.


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## Lochy

It is simple. Which is why my first suggestion was to phone the revenue. They will confirm everything I have said is correct. The original post was not that their company is setting up an irish operation, but that the person was simply going to be working from home. 2 different scenarios. 


My wife has been working in this manner for over 3 years now(with 2 different companies) and we have all this confirmed in writing by the revenue. WIth regard to "complicating factors", I have been through this process personally and my initial post is correct.


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## Breninio

So you have a letter from Revenue that states that even though your wife is employed by a UK company and carries out the duties of her employment for that company in Ireland on a full time basis, Irish PAYE need not be operated on that income? And the letter also explicitly states that the activities carried on by your wife on behalf of that UK company does not create a permanent establishment in Ireland for that company and give rise to corporation tax issues? That is a letter I would like to see and I would recommend that you hang on to in case Revenue look into it as both statements are incorrect. Or more to the point, your wifes employer would need to have to hand if Revenue come calling as it is more a tax exposure for them than your wife (at least your wife is filing self employed tax returns). Irish PAYE should be operated on your wifes income and Revenue could argue that the payments she is receiving is net of Irish PAYE and look for the UK company to gross up those net payments and pay over the PAYE with interest and penalties. In addition it is very possible that the UK company has an Irish corporation tax exposure and certainly a reporting obligation. Unfortunately, the people manning the phones at Revenue are not the ones to be making calls on these complex situations (although they often do). And verbal confirmations wont count for much as there is no evidence of the information provided to them on which they based their advice. You state that the UK company company is not setting up "operations" in Ireland. This is a commercial concept and is irrelevant. Under tax law, an employee of a UK company based full time in Ireland will normally create a permanent establishment of that company in Ireland.


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## Lochy

You are getting some different scenarios confused. My wifes company do not operate or derive profits in Ireland. She simply works from home. That happens to be in another EU country. There are no corporation tax liabilities in this scenario. 

I dont want to get into a big discussion in a long thread. I have been through this. I know the rules. I am backed up by revenue, an Irish Accountant and a UK accountant hired by my wifes company to look into potential issues. I would rather believe them than someone on a forum who doesn't understand the issues.

There is no peramanent establishment. She works from home. Where that happens to be is irrelevent. She goes to the UK about 1 in every six weeks. She logs into their server and works through the London office. She carries out UK duties.

As I said to Dazzerb this is simple. You are introducing complexities where there are none. I am correct and I have done all this with full disclosure to the revenue. I was surprised when they decided to treat my wife as self employed, but have been doing so for three years. We provide gthe revenue with my wifes P60 from her employment in the UK, so it is not as if they dont understand that she is working for a UK company.

I would suggest Dazzerb contacts the revenue and they will tell him the scenario.


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## Breninio

If your wife is an employee of this UK company then my advice is correct - the Revenue, your Irish tax advice and your UK tax advice are incorrect. I understand the issues alright and have dealt with them many times before. How can your wife be self employed if she is an employee of this UK company?


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## Lochy

Breninio said:


> If your wife is an employee of this UK company then my advice is correct - the Revenue, your Irish tax advice and your UK tax advice are incorrect. I understand the issues alright and have dealt with them many times before. How can your wife be self employed if she is an employee of this UK company?


 
I cant agree. I have dealt with these issues personally. She is treated as self-employed for Irish tax purposes in that she must fill in an annual tax form, and can pay tax in advance if needed.All the tax is initially paid in the UK, and she pays any balance at the end of the year. My advice is correct. Her company checked this all out through accountants and tax lawyers. 

She is treated as self-employed as although she resides in Ireland full time, she earns money outside the state(the UK). The company has no Irish payroll and no irish presence. so she cannot pay Irish PAYE directly. Therefore she declares her tax liabilities as if she was self-employed.
We will not agree on this, which is why I have suggested to dazzerb that their first port of call must be the revenue.


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## Breninio

The treatment you outline would have been correct pre 2006. However since 2006 this is not case. See link below to Revenue website.

[broken link removed]


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## Lochy

Depends on interpretation of "duties outside the state". All the work is done through the UK office for UK and international clients, so all her duties are in the UK. She just logs in from ireland. b is relevent in this situation, so not within the irish PAYE situation.

Talk to the revenue. they will confirm this


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## Breninio

There is nothing to interpret in the words "duties outside the State". If you are physically in Ireland, performing work duties, then those duties are Irish work duties. Simple. I don't need to call Revenue.I know I am correct.


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## Lochy

Breninio said:


> There is nothing to interpret in the words "duties outside the State". If you are physically in Ireland, performing work duties, then those duties are Irish work duties. Simple. I don't need to call Revenue.I know I am correct.


 
You are deemed a virtual worker. Where you work is up to you, but you have a UK employment contract for working within the UK. 

You are working through the Uk, for a UK company working on projects in the UK. Your duties are outside the state. Physical location is irrelevent.

Contact revenue. They will confirm this....


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## Breninio

I give up!!!! Virtual worker, schmirtual worker! How can physical location be irrelevant? It is key. Irish PAYE should definitely apply and Irish corporation tax could certainly apply. I don't need to call Revenue.


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## number7

I have a business in Ireland, I have employees in the uk, so a bit the reverse. The advice of the uk revenue to me on how to treat them from a tax perspective surprised me. I expected to be told to register my business for tax purposes in the uk and pay employment taxes as usual through the paye method or that my uk employees should register in ireland and be taxed through the irish paye system and then file their annual returns in the uk and get allowance for taxes paid in ireland.

The advice of the uk revenue was that my uk staff be paid gross by means of a payment schemen ( new one on me) and that they should then pay their dues to the uk revenue. 

Works for me, as I dont want the headaches of double paperwork.

Like most things there are probably a number of different ways to do what the original poster asked.


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## Lochy

There are a few options. One we looked into was get paid gross as a contractor and just declaring everything and paying all PRSI,Health Levy, Income Levy and PAYE at the end of the year, but we choose not to do this as it we wanted to make sure that her company was not inconvenienced in any way. they were doing her the favour by allowing her to work from Ireland.
We chose the option(after lots of advice) that she keeps paying UK tax as normal and declare an annual return in Ireland as a self-employed person. 
The option you choose with a payment scheme was not one I am aware off but I can see how this would be beneficial to both the company and the individual. 
It depends on the individual situation as to what is best, and what the company involved is prepared to do. It they want to set up an Irish payroll, then there is no issue. 
dazzerb needs to choose the option that is best for them. But my refrain throughout this is to contact the revenue and take their advice.


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## opollo

I am in the same position. I work for a UK company but based as a field service engineer.
The option we chose was to use an irish payroll company to pay me each month under the irish tax system. I am still an employee of the UK company, but am covered under Irish employment law. the only thing that was hard to setup was the pension. but thats sorted now.


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## Breninio

Opollo, your employer obviously got accurate tax advice and proceeded to make appropriate arrangements. That advice would have been, as I have been repeatedly stated, that they have an Irish PAYE exposure due to your activities here. There are 3 different ways that Non-Irish employers can meet these PAYE obligations - Register for Irish PAYE themselves, use the payroll of an Irish related company or use a payroll company. Your company has, like most non-Irish companies, chosen the latter option. 

Lochy - this Irish PAYE exposure has not arisen due to them using an Irish payroll, this is the solution to the PAYE requirements that have arisen due to the poster having work duties here. The advice you have taken is incorrect.


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## Lochy

Breninio said:


> Lochy - this Irish PAYE exposure has not arisen due to them using an Irish payroll, this is the solution to the PAYE requirements that have arisen due to the poster having work duties here. The advice you have taken is incorrect.


 
No it is not, I have taken advice both directly and indirectly from the following

1. UK Accountants and UK Tax lawyers indirectly through my wifes company
2. Revenue in ireland. 
3. Accountants in Ireland.

I double checked this with my accountant this morning as you briefly had me worried. It is all above board and correct. If you feel you know more than accountants, tax lawyers and the revenue, then nothing I will say will change your mind.

My wifes work duties are not here, they are in the UK. I have been quite clear on this. She executes them from Ireland, but her duties remain in the UK and subject to UK laws such as UK freedom of information/money-laundering etc. This is the crucial point and one which revenue agrees with.

Finally, my wife does pay Irish PAYE, but she does it annually instead of monthly.


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## Lochy

opollo said:


> I am in the same position. I work for a UK company but based as a field service engineer.
> The option we chose was to use an irish payroll company to pay me each month under the irish tax system. I am still an employee of the UK company, but am covered under Irish employment law. the only thing that was hard to setup was the pension. but thats sorted now.


 
Yeah pension is a bit of a nightmare. I became the first Irish employee of a US company about 2 years ago, and finally got my pension sorted last month. I was a bit if a guinea-pig for them and a lot of things went wrong. I am making double payments for 2 years to catch up.


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## Domo

I agree with Breinio - 

Your duties are carried out where you are physically situated.  If you are physically in Ireland when doing work and if you are an employee of a foreign company, they should be operating Irish PAYE on your income.  However, if they do not operate PAYE, that is the company issue - they are breaking the law 

www.taxingtimes.ie


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## Lochy

Domo said:


> I agree with Breinio -
> 
> Your duties are carried out where you are physically situated. If you are physically in Ireland when doing work and if you are an employee of a foreign company, they should be operating Irish PAYE on your income. However, if they do not operate PAYE, that is the company issue - they are breaking the law


 
Fair enough if that is your opinion. Her company are a financial company in the city of London with offices in 17 countries. They have checked out their legal and tax position and they have no obligation to operate Irish PAYE. It was her decision to work from ireland, the company did not ask her to. I would think they have looked at all angles being an experienced multinational company.

Look, this was our accountants and revenues suggestion as to how she handles her tax. They want to see both P60's that cover the Irish tax year(the UK one being Apr-Apr). They calculate an exchange rate which is the average of the year. They are fully aware that she resides full time in Ireland. We have been extremely open with the revenue throughout this entire process. My wife pays the same tax as she would if she earned the money directly in Ireland, so we are not avoiding paying tax, we are just doing it annually.

I have the letter from revenue stating that she will have to fill in an annual tax return and they will discount all taxes paid in the UK through PAYE from her annual tax liability.


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## Domo

I don't want to be pedantic - but I have come across a similar situation recently -a large multi-national who had a guy working remotely in Ireland (a client of mine) - they thought they had the position all tied up - but were wrong!

However, I would say that these boards are fine for general guidance, but without knowing the FULL story, and all the back up documents and history, the advice you can give on boards is limited.  I'm sure the company's advisors have boxes of documents and information before giving their final opinion (and charged accordingly).


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## Lochy

Domo said:


> I don't want to be pedantic - but I have come across a similar situation recently -a large multi-national who had a guy working remotely in Ireland (a client of mine) - they thought they had the position all tied up - but were wrong!
> 
> However, I would say that these boards are fine for general guidance, but without knowing the FULL story, and all the back up documents and history, the advice you can give on boards is limited. I'm sure the company's advisors have boxes of documents and information before giving their final opinion (and charged accordingly).


 
Agreed. Her company has checked and double checked and got charged accordingly no doubt. One thing I have learned about tax is that there is never a one size fits all solution. I have always followed the advice of revenue, and although they can get it wrong at times, that has always seemed the best course of action


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