marathonic
Registered User
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As someone who works in Northern Ireland and lives in the Republic, I will probably be posting a few different threads on the taxation issues, etc. for this particular group of people.
I'm currently looking into the purchase of UK shares - although the below is relevant to rental income and all other forms of income from the republic, e.g. if you have a job both sides of the border.
Let say someone in the North is on a salary of £19,872. This means they pay £3,006 tax in the North.
When calculating their tax in the South, they'll obviously get the Single Persons Credit but according to the site below, they'll also qualify for the PAYE credit.
[broken link removed]
This means they'd calculate their Irish tax liability as follows:
Foreign Income... €29,078 (£19,872)
Irish Income........ €4,000 - e.g. Dividends/Rental Income
Total Income .... €33,078
Tax ............................... €6,615.60
- Single Persons Credit ...... €1,760.00
- PAYE tax credit.............. €1,760.00
Tax Due ..........................€3,095.60
Then, according the the document on the following page:
[broken link removed]
You must calculate what you owe as Tax Due * Irish Income / Total Income = 3,095.60 * 4,000 / 33,078 = €374.33 (this is the tax due to the Irish Government for your €4,000 Irish Income)
In the case of UK shares, the UK also withhold 10% dividend tax which is non-reclaimable which would make your dividend tax payable in the above scenario a total of 19.35%. However, were the €4,000 to come from Irish dividends, the total tax on your dividends would be only 9.35%.
I'm no expert on the matter, my posts will just come from my research on the net and may not be correct. Anyone who reads this and has an opinion as to whether it's correct or incorrect, please post to say that you agree or disagree - if a few people post to say they agree it will give the post a bit more credibility.
P.S. What I can't figure out is this: In the following document [broken link removed] on page 30, it calculates the tax liability in two ways and, in all cases, when calculated in the above way, the tax liability is lower. However, in the above case, £3,006 tax is paid in the North and only €3,095.60 is due in the South. If you were allowed to offset the tax paid in the North with the tax due in the South, you would have to pay NO tax in the South (as in one of the methods the above documents use to calculate the tax). Has one of the methods been done away with or can you calculate using the two methods and pick the one that gives the lower tax liability?
I'm currently looking into the purchase of UK shares - although the below is relevant to rental income and all other forms of income from the republic, e.g. if you have a job both sides of the border.
Let say someone in the North is on a salary of £19,872. This means they pay £3,006 tax in the North.
When calculating their tax in the South, they'll obviously get the Single Persons Credit but according to the site below, they'll also qualify for the PAYE credit.
[broken link removed]
This means they'd calculate their Irish tax liability as follows:
Foreign Income... €29,078 (£19,872)
Irish Income........ €4,000 - e.g. Dividends/Rental Income
Total Income .... €33,078
Tax ............................... €6,615.60
- Single Persons Credit ...... €1,760.00
- PAYE tax credit.............. €1,760.00
Tax Due ..........................€3,095.60
Then, according the the document on the following page:
[broken link removed]
You must calculate what you owe as Tax Due * Irish Income / Total Income = 3,095.60 * 4,000 / 33,078 = €374.33 (this is the tax due to the Irish Government for your €4,000 Irish Income)
In the case of UK shares, the UK also withhold 10% dividend tax which is non-reclaimable which would make your dividend tax payable in the above scenario a total of 19.35%. However, were the €4,000 to come from Irish dividends, the total tax on your dividends would be only 9.35%.
I'm no expert on the matter, my posts will just come from my research on the net and may not be correct. Anyone who reads this and has an opinion as to whether it's correct or incorrect, please post to say that you agree or disagree - if a few people post to say they agree it will give the post a bit more credibility.
P.S. What I can't figure out is this: In the following document [broken link removed] on page 30, it calculates the tax liability in two ways and, in all cases, when calculated in the above way, the tax liability is lower. However, in the above case, £3,006 tax is paid in the North and only €3,095.60 is due in the South. If you were allowed to offset the tax paid in the North with the tax due in the South, you would have to pay NO tax in the South (as in one of the methods the above documents use to calculate the tax). Has one of the methods been done away with or can you calculate using the two methods and pick the one that gives the lower tax liability?