Stupid question

CB in OZ

Hi,
I'm not sure if anyone can help me as this is a very tricky one and I'm getting no help from revenue at all.
I have been living in Australia for the last two years and have recently received the money for some shares I had in Ireland. I have just sent my payment to the revenue for the income tax on these shares, which I had to pay at 41% (alot of money)!
I am not earning in the country or living in the country but I still have had to pay them income tax on shares at 41%. I got a couple of varying answers from them as to whether I pay it at 20% or 41% beforehand though!
They recently cancelled the mortgage interest relief at source I have been receiving on my mortgage (for my property at home), so they will no longer give me the mortgage relief as I am living outside the country, which is fair enough.
So my question is this, is it right that they can cancel my mortgage interest relief as I am residing outside the country, but however on the flip side I have to pay them the tax, whilst all along I am out of the country. Probably a stupid question as they are the revenue, but I am not up on this at all so any advice would be very grateful.
Cheers

Victor

Split from thread in Accommodation & Property.

Leon11

AFAIK since you've been away for two years your tax status is Ordinary and Non-Resident which means that you'll be taxed on Irish based shares and any income that you remit back to Ireland. If you've sent money back here maybe that's the reason you've been charged at 41%, other than that I think you should only get done for 20%.

Only a student so one of the more qualified heads can offer better advice.

the1andonly1

was it a sale of shares or dividends that you received? both of these are taxed at 20%, (capital gains tax if it was a disposal of shares and you made a chargeable gain, or income tax if dividends) though generally the dividend tax will be deducted at source (dividend witholding tax which is taxed at the standard rate of 20%)

Fruiti

The rules regarding residency are fairly complex - you need to be non resident for 3 years before you become non-ordinarily resident so assuming you're only non resident for 2 years then you are still ordinarily resident and Irish domiciled. In which case the Revenue will tax you on all income and capital gains sources except for any foreign employment income earned outside of Ireland. If it's a sale of shares then you should be paying CGT at 20% on the gain, however, if it is an exercise of an option then you are charged to income tax on the gain made since the grant of the option - really unfair I know! Either way, if your overall income (chargeable to Irish tax) is less than 34K you shouldn't be paying marginal rate tax, only 20%. You'll need to file a tax return to reclaim any overpayment - TBH if you have lots of income from various sources incl foreign sources you need professional advice to ensure you get full Irish credits and bands. You should also get credit for foreign tax paid.:)