Self employed in the North - Tax in the South

[zalm]

Does anyone know the rules and regs around working self-employed in the North and paying appropriate taxes there, but residing in the South and having to pay tax here.

A friend of mine works up the North, but lives in the South and has suddenly been hit with a HUGE tax bill from the South from his accountant. Accountant sounds like a muppet, but would be good to know the rules around it.

 

[ubiquitous]

A friend of mine works up the North, but lives in the South and has suddenly been hit with a HUGE tax bill from the South from his accountant. Accountant sounds like a muppet, but would be good to know the rules around it.

He should ask his accountant.

 

[Domo]

If an individual is resident in the Republic (and domiciled), they are liable to tax on income no matter where it is earned.

Has he paid tax in UK? If so, he may be entitled to tax credits.

But, as above, he really needs to speak to his accountant to see what has been taxed where etc.

 

[zalm]

I agree, but the fact that his accountant is the one who now tells him he owes a small fortune to the tax man by Friday makes me think that his accountant is not the sort of solid fellow that you'd be relying on for good advice.

 

[ubiquitous]

I agree, but the fact that his accountant is the one who now tells him he owes a small fortune to the tax man by Friday makes me think that his accountant is not the sort of solid fellow that you'd be relying on for good advice.

Why? All accountants occasionally have to tell clients that they owe tax bills. Does your friend want an advisor who only tells him what he wants to hear?

 

[zalm]

He might have given him a bit of warning....

He also may have given him some advice that wouldn't mean that due to taxation in both states means his take home pay for a years work is negligible.

Something ain't right which is why I'm looking for some rules and regs around it. I take it the transborder relief is ineligible because he is self-employed, but there must be something in place that negates double taxation.

 

[ubiquitous]

He might have given him a bit of warning....

He also may have given him some advice that wouldn't mean that due to taxation in both states means his take home pay for a years work is negligible.

Something ain't right which is why I'm looking for some rules and regs around it. I take it the transborder relief is ineligible because he is self-employed, but there must be something in place that negates double taxation.

As I said earlier, he will need to discuss it with his accountant.

 

[zalm]

Oki doki. Ta.

 

[ubiquitous]

Fwiw, see [broken link removed] (a bit out of date, given that Foreign Earnings Deduction was abolished some years ago, but it should give you the basics.

This paragraph may be particularly relevant.

If tax is charged in a country with which Ireland has a double taxation agreement you will be
given relief as specified in the relevant agreement. This is normally provided by either
exempting the income from tax in one of the countries or by crediting the foreign tax paid
against your Irish tax liability on the same income.