Tax situation on properties

jackie_brown

Hi can someone please help me with this situation below?

Jane Doe has a large property portfolio of rental properties.
Most of these properties are in Ireland, with the exception of two in Spain.
Jane receives an income stream from all properties and expects that this will remain the same in future.
She also receives an annual dividend from her father's Irish company.

Jane has just decided to go and live in Australia, to be with a man she's recently met, and see how the relationship will progress.

What tax implications has she on her impending move to Australia?

TaxingTimes

As a non resident landlord, her tenants should deduct basic rate tax from the gross rent and pay the net rent to her, and the tax to the Revenue. She will receive a credit for this tax paid when her tax return is completed.

To avoid this happening, she should consider appointing an Irish resident agent to act on her behalf with the Revenue, this could be a family member or friend, but note that this person becomes liable for any Irish tax due if she does not pay the tax.

As a non-resident she will be liable to tax in Ireland on any Irish source arising income, which will include rental income and Irish sourced dividends.

Assuming she is Ordinarily resident in Ireland at the moment, she will remain ordinarily resident until she has been non-resident for 3 continuous tax years, and will be liable to Irish tax on her worldwide income with the exception of an overseas trade or employment. Therefore she will be taxable in Ireland on her Spanish income also if the income is over €3,180 per annum.

As a non-resident, she will be entitled to personal tax credits which will be apportioned based on her Irish income over her worldwide income.

This is a complex issue, and the above is only an overview of the position based on the information provided and should not be relied upon.

She should seek professional advice

jackie_brown

thank you for the advice

TaxingTimes

Just one further point.

If things don't work out in Australia, and she returns to Ireland, therefore not breaking Irish residence, she will remain taxable in Ireland on full worldwide income, including Australian income (if any).

jackie_brown

Ok great.

can i also ask:
What is the difference between a resident and domicile?
As she is of Irish citizen, currently residing in Ireland, about to move to Australia (hoping for long term), would that make her a non-domicile?
and only after 3 years of residing in Australia, would make her a non-resident in Ireland?

TaxingTimes

Residence is based on number of days spent in country.

Domicile is a legal term that broadly means where you have your roots. It is difficult to change your domicile without cutting ALL ties to a country, and that is more difficult that it sounds.

She is likely to remain Irish domiciled, although if she is non-resident in Ireland this is not likely to impact on Irish tax position - domicile only relevant if resident.

She should take professional advice, as this is about as detailed I can go on a forum.

jackie_brown

ok many thanks

Mr. Incognito

As per the thread forum I lock property threads as a rule but I'm going to allow this because it is hypothetical. Keep it that way. Good old Jane Doe an her imaginary adventures. What will she get up to next.

w123

I thought that she was dead!