Tax query, 280 day look back rule

pkone

I left Ireland in January 2007 to work in the UK...am now tax resident in the UK and no longer tax resident in Ireland. My last normal pay check from my previous Irish employer was in January 2007, however, I recently agreed a payment from them (not severance or termination, more of a once-off bonus payment) which was paid into my bank account in Ireland in February 2008...tax was deducted at the emergency rate (41%) from the payment plus they have deducted PRSI at 6%.

Having reviewed some of the rules, I think that I was tax resident in Ireland in 2007 under the 280 day look back rule.

The payment amount was EUR30k with tax deducted of EUR12.3k.

I was about to complete a Form 12 for the tax year 2007 as I think I am entitled to some of the tax I paid back using the tax credits unused for 2007. I spoke with someone at the Revenue who said that "the payment itself relates to 2007 but the tax was paid in 2008" and therefore I should not be entitled to tax back for 2007 but that I should submit a Form 12 in 2009 (for tax year 2008) citing no income for 2008 but tax paid of EUR12.3k...that then I would be entitled to these moneys back as I "had no income for that year". This seems unusual to me as the payment related to 2007 although I received it physically in 2008.

My former employer has sent me a supplementary P45 and payslip for the payment in question.

Would very much appreciate some advice on this.

PK

leeroybrown

Regardless of when the payment was due your former employer paid it in 2008 and your income and tax payments for 2007 will have been calculated without it. The employer is required to make the tax deduction on the date of payment not the date of the work.