question re taxation in UK when you've worked in both countries

ergo

Hi

first time registered as self employed, just doing 2009 returns now

Am irish resident but was domiciled in UK for 257 days in 2009 returning in September and paying UK PAYE there

I returned to ireland Sept 2009 and worked for about a week as self employed and then for the remaining 3 months as PAYE in Ireland

while completing my self assessment for this self employed income do I have to put in under foreign earnings my UK income and what tax I paid?

according to the convention between Ireland and UK on double taxation http://www.revenue.ie/en/practitioner/law/double/uk.html

Employments
1.Subject to the provisions of Article 17 and 18, salaries, wages and other similar remuneration derived by a resident of a Contracting State in respect of an employment shall be taxable only in that State unless the employment is exercised in the other Contracting State. If the employment is so exercised, such remuneration as is derived therefrom may be taxed in that other State.
2.Notwithstanding the provisions of paragraph (1) of this Article, remuneration derived by a resident of a Contracting State in respect of an employment exercised in the other Contracting State shall be taxable only in the first-mentioned State if:
a.the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in the fiscal year concerned; and
b.the remuneration is paid by, or on behalf of, an employer who is not a resident of the other State; and
c.the remuneration is not borne by a permanent establishment or a fixed base which the employer has in the other State.

I took it to mean I don't have to declare UK income as I was over there for >183 days and only have to declare remittances ie any cash I transferred back into Ireland

any thoughts on this one?

spoke to a somebody in revenue and they suggested I do have to put in all income and tax paid in UK under foreign income section, didn't get a chance to quote the above thing to them but will try to get back in touch with them again

kennyb3

I am open to correction as this is a difficult one but my understanding of the situation is and some key points for you:

1. Your domicile doesn't change willy nilly. I take it you are Irish domiciled but resident in the UK in 2009 (not the other way around as you ve suggested)

This will help:

http://www.citizensinformation.ie/en/money_and_tax/tax/moving_country_and_taxation/tax_residence_and_domicile_in_ireland.html

2. If you are resident in the UK in 2009, you need to do a UK tax return including all income earned - uk and irish.

3. You need to do a form 11 including only the irish income and pay the tax on same.

4. You ll get a credit on your UK tax return for any tax paid here, so you dont end up paying tax twice.

More info here:

http://www.revenue.ie/en/personal/circumstances/moving/tax-residence.html

Regards,

Brian

Mr. Incognito

The tax year in the UK runs April to April.

The tax year in Ireland runs Jan- December

If you worked in the UK the UK has primary taxing rights on that income with a credit granted here for the UK tax paid.

You will also have to do a recalulation of the UK tax based on an effective rate test.

In the UK: You will need to either file a self employed tax return or get a copy of your pay and tax depending on the circumstances.

In Ireland you will have to declare UK income for the relevant periods and file a Form 11.

In short both jurisdications have taxing rights with a credit granted here for the UK tax paid.

PM me if you want me to do the forms for a fee.

kennyb3

Mr. Incognito wrote: »

In Ireland you will have to declare UK income for the relevant periods and file a Form 11.

Full UK income? Are you sure?

ergo

thanks for the replies

regarding domicile and residence my understanding is that I am resident in ireland for 2009 as (from www.revenue.ie)

You will be resident in Ireland for a tax year in either of the following circumstances:

If you spend 183 days or more in Ireland during a tax year or,
If you spend 280 days or more in Ireland over a period of two consecutive tax years, you will be regarded as resident for the second tax year. For example, if you spend 140 days here in Year 1 and 150 days here in Year 2, you will be resident in Ireland for Year 2

in my case I spent 328 days in Ireland over the 2 consecutive years 2008-2009

regarding domicile, well the person at revenue said that, yes I could tick the "resident but not domiciled in ireland" box for 2009

although from the revenue site domicile is as follows..

Every individual acquires a domicile of origin at birth. A domicile of origin will remain with an individual until such time as a new domicile of choice is acquired. However, before the domicile of origin can be shed, there has to be clear evidence that the individual has a positive intention of permanent residence in another country and has abandoned the idea of ever returning to live in his/her country of birth

now I did fully move to UK, got a place, bought a UK reg car, could have stayed there forever in theory, didn't have a residence in Ireland but obviously still had Irish bank a/c etc and getting post here etc..hard to prove the "ever returning" aspect maybe..I don't think they'd be able to prove that I definitely planned returning because I could well have stayed in the UK forever..*whispers* possibly should have....

on the form 11 then it says that for those who are "resident but not domiciled":..

you are assessable to tax on your Irish income and remittances of foreign income. Enter the amount of the remitted income in the Foreign Income Panel

so that suggests to me that I don't need to declare UK income but should declare any cash I transferred back to Ireland

it doesn't seem fair that if I declare my UK income which I already paid UK (PAYE type, not self employed type) tax on I could be hit with a liability here in Ireland...On the other hand, by not declaring it, it suggests I have overpaid tax in ireland which wouldn't appear to be the case tbh

for the record I now don't have any intention of returning to the UK and wasn't planning getting too involved in doing a complex UK tax return as I was PAYE over there


I certainly may be taking up offers of assistance via PM, thanks

PS: I have registered my UK car here and (for VRT purposes) have already proven to revenue via bank statements, job contract, lease etc that I did live continuously in UK for > 6 months..On a slightly separate issue...I know they probably work in completely different circles but I would expect some data to be shared, if not all

ergo

one other quick question

when declaring UK income and tax paid..

can I / do I include National Insurance Contributions (NIC) in my tax paid....?

Legend100

The quote above from the Revenue website with regards to domicile doesn't really portray the reality of the situation.

(i take it you were born of an irish father as this will determine your domicile of origin and not where you were born yourself)

It is quite difficult for one to prove that they have abandoned there domicile of origin for a domicile of choice. Buying a house abroad is one aspect but you must abandon all ties with your origin country. Case law has proven that is can be be difficult to prove that you have abandoned your domicile of origin.

Not to spound flippint but to be honest, most of the people you talk to in revenue do not have sufficient knowledge on a topic (especially in this area) to be taking there advice as correct. You would need to speak to an inspector and it is unliklely one would speak to you over the phone

It is more than likely that you will be irish domiciled but I would seek professional advice such as that offered by Mr Incognito. If you are irish resident and domiciled, the tax return will be relatively straight forward.

NIC contributions are completely separate and will not be counted in regards to UK tax paid

ergo

thanks for that, yes it appears I am Irish resident and domiciled

I think I need to speak in person to an expert, there is someone locally to me that I have in mind so I am going to try and sort that out tomorrow,

again I appreciate everyone's input

Mr. Incognito

First year clerical officers answer the phones and generally know nothing.

Domicile is a legal concept. You are not UK domiciled just because you move there. It is very difficult to establish a new domicile.