Irish Taxes

Income Tax:

The short version is this for 2008:

Single Taxpayers

Personal tax credits of €1,830
Income Tax after subtracting deductions from total pay:
20% on the first €35,400
41% on the balance

Married Taxpayers (two incomes)

Personal tax credits of €3,660
Income Tax after subtracting deductions from total pay:
20% on the first €70,800
41% on the balance

Married Taxpayers (single income - this is a scheme to encourage/force more women into the work force)

Personal tax credits of €3,660
Income Tax after subtracting these deductions from total pay:
20% on the first €uro 44,400
41% on the balance

The Sunday Business Post, Ireland's financial newspaper, estimates that a single worker making the average industrial wage of about €33,000 will take home 75% of their income - roughly the same as U.S. workers. Still, it's worth noting that nobody's starving in Ireland.

The key points of the income tax, including personal allowances and deductions, can be found at the Revenue Commissioner's site. This page will connect you to more information than you'll want to know about the current tax regime.

Tax Free Interest for Non-Residents

A special point of interest: Investors with overseas addresses earn tax free interest on non-resident bank accounts. You may want to open a savings account with an Irish bank before you move to take advantage of this tax free saving.

Once in the country there are a load of government allowed tax shelters designed to encourage business investments and promote urban renewal. I cover these and other investments on the Investment page.

Residency and Tax Treatment for Monies Made Overseas

Residency rules are as follows: To be considered tax resident in Ireland, the individual must spend either 183 days in Ireland in a tax year or aggregate 280 days in Ireland by aggregating days spent in the current and previous tax years (presence in Ireland of not more than 30 days will not be taken into account for the '280 day' test).

An individual returning to Ireland during a tax year, therefore, may not be resident if he/she does not spend 183 days in Ireland in the year of return. However, the rules do permit the individual to elect to be resident in the year of return on the basis that the individual will be resident in the following year and this can be advantageous in some cases.

The decision to elect to be resident should not be taken lightly as it is irrevocable. The election is normally beneficial for income tax purposes but may have an adverse effect on your capital gains tax position as there is no split year concept for capital gains tax purposes.

For the complete rules regarding residency and monies made overseas spelled out in detail, visit the Revenue Commissioner's site at: http://www.revenue.ie/leaflets/taxguide_chapt3.htm This is a straightforward and understandable guide examining the most commonly asked questions upon moving to Ireland.

There are plenty of other items and links in the Full Site.

Additional topics include tax considerations for those moving to Ireland, double taxation agreements and dealing with overseas taxes, investment advice links, Emergency Tax Rates for new workers, and more.