Moving to Ireland

nowayingere

Hi guys,

I was wondering if you guys can help me to clarify this point.

I don't know exactly how the taxes rates in Ireland are calculated. I did some research and based on the information I found here:

http://www.revenue.ie/en/tax/it/leaflets/it1.html#section3

I came to a value of 3.278€ per month for a pay of 55K

Is this value right?

Thanks,

Marco

namenotavailablE

I've a link to my Excel spreadsheet contained in my signature (you need to be signed in to see the link) underneath this message.
I can't post the link in the body of this message as the moderator doesn't test/ trust such calculators and doesn't permit them to be linked (other than in the signature).

nowayingere

Hi namenotavailabl

Using your excel it shows a net value of 3.127,91, quite a difference.

Thanks

namenotavailablE

The value depends on your precise circumstances- single/married/with or without children etc. Also, if you've a compulsory pension deduction, this impacts on your net pay.
Make sure that you've entered all the relevant values correctly- the calculator works 100% for my circumstances and also for a number of others where I've been able to test their actual net against the calculated net. However, "caveat emptor"- it comes with no warranty!

namenotavailablE

It's probably also worth pointing out that if you start a job in the middle of the year, you'd have the benefit of the tax credits from January. That would make your net pay greater for a couple of months after which it would settle back to a more normalised level. You can see the effect of this by setting the "First period this pay is received" to the appropriate month.

nowayingere

I am not saying there is a problem with you calculator, all I am saying is that there is a difference of about 150€.

Either way, I now have an idea of how much I will have to pay.

Thanks,

Marco

namenotavailablE

Best of luck with your decision!

nowayingere

namenotavailabl wrote: »

Best of luck with your decision!

Thanks mate

Just one small question. Am I entailed to receive any tax benefits for being a student in Portugal? The fact that I have got to pay for flights and the University fees I will have to pay? I am already a graduated, but I've started a another degree in Portugal, which I pretend to finish even being abroad.

Marco

namenotavailablE

There is a limited tax relief for graduate fees- I'm not sure whether your course would qualify, however. See the document here

EDIT: As the fees you're paying refer to a Portuguese based university, I think the course you are studying would have to be a post-graduate course with at least 1 year's duration.

nowayingere

Thanks a lot

nowayingere

Hi there,

Just a follow-up question. I will be moving to Ireland, but I do own two houses in Portugal, one is rented, and a heard that I can make a claim to get a tax relief.

Is it really possible to do this? I was told I would have to put this costs as housing costs.

Thanks,

Marco

dardhal

Hi, for the first question in your initial message, regarding how much net salary is going to be your gross salary of 55K/year, the best way to know is to feed your personal salary and family details to this site, and let it do the math. As Irish taxation is quite simple (though maybe not fair), the values you get from that site will match to the cent your real net income, provided you are not emergency taxed (and that may happen to you, as a first time worker in Ireland, if it takes some time to sort your PPS and revenue affairs out). You can also look at the source of the information, revenue.ie, of course.

nowayingere wrote: »

Just a follow-up question. I will be moving to Ireland, but I do own two houses in Portugal, one is rented, and a heard that I can make a claim to get a tax relief.

Is it really possible to do this? I was told I would have to put this costs as housing costs.

If you move to Ireland after July 1st, you will probably have to sort your taxation affairs in Portugal, as you will have been living there most of the year, and international tax legislation says you are to pay your salary taxes on the country you have lived the longest part of every year, sort of. In Ireland you will be taxed as well, but after the end of the year you may ask for a tax return because the way taxes are calculated in Ireland you will be entitled to get back some or all of what you paid.

If you come to Ireland and start working before July 1st, then you will be taxed in Ireland as usual, you may be entitled to some tax refund at the end of the year, but I don't know how your year 2012 incomes from Portugal will have to be declared to the Irish revenue office, as far as I know, you don't have to (due to the way direct salary taxes are calculated in Ireland).

There was once in Ireland a "rent relief" scheme that allowed people to get some "tax credits" (tax returns in the end) to ease the burden on those paying rents to live in Ireland. Starting in year 2011, no more applicants to the rent relief scheme are accepted, and only those that already enjoyed it are entitled to yearly decreasing returns / relief.

So, no matter how many houses you own, pay for or get money from in Portugal, Irish revenue don't care about them neither in the sense of helping you or taxing you. These taxation issues are very twisted, and at least the equivalent to Revenue in Spain don't have a clue about most of the usual user cases that can happen to those leaving for a job abroad.

Mr. Incognito

dardhal wrote: »

Hi, for the first question in your initial message, regarding how much net salary is going to be your gross salary of 55K/year, the best way to know is to feed your personal salary and family details to this site, and let it do the math. As Irish taxation is quite simple (though maybe not fair), the values you get from that site will match to the cent your real net income, provided you are not emergency taxed (and that may happen to you, as a first time worker in Ireland, if it takes some time to sort your PPS and revenue affairs out). You can also look at the source of the information, revenue.ie, of course.



If you move to Ireland after July 1st, you will probably have to sort your taxation affairs in Portugal, as you will have been living there most of the year, and international tax legislation says you are to pay your salary taxes on the country you have lived the longest part of every year, sort of. In Ireland you will be taxed as well, but after the end of the year you may ask for a tax return because the way taxes are calculated in Ireland you will be entitled to get back some or all of what you paid.

If you come to Ireland and start working before July 1st, then you will be taxed in Ireland as usual, you may be entitled to some tax refund at the end of the year, but I don't know how your year 2012 incomes from Portugal will have to be declared to the Irish revenue office, as far as I know, you don't have to (due to the way direct salary taxes are calculated in Ireland).

There was once in Ireland a "rent relief" scheme that allowed people to get some "tax credits" (tax returns in the end) to ease the burden on those paying rents to live in Ireland. Starting in year 2011, no more applicants to the rent relief scheme are accepted, and only those that already enjoyed it are entitled to yearly decreasing returns / relief.

So, no matter how many houses you own, pay for or get money from in Portugal, Irish revenue don't care about them neither in the sense of helping you or taxing you. These taxation issues are very twisted, and at least the equivalent to Revenue in Spain don't have a clue about most of the usual user cases that can happen to those leaving for a job abroad.

I don't even know where to start but pretty much all of this is wrong.

You will be resident in Ireland for tax purposes if you are here over 183 days in a year. Irregardless you can elect to be resident from the date of arrival under S 822 Split year relief. It may be of benefit to remain non resident or resident depending on personal cirumstances.

Rental income earned from foreign property whilst you are resident is subject to Irish taxation as current income earned only if you remit this income into the country. If it comes into the irish tax net then you are entitled to the same deductions that you would receive against a rental income in Ireland, repairs, wear and tear etc. This can be avoided by ensuring that all your foreign rental income remains in a foreign bank account and you do not remit the proceeds into Ireland with you.

Income earned prior to arrival is capital in nature and is not within the charge to irish tax.

Where you are taxed in both jurisdictions on the same income effective rate calculations may be required to net one tax off against the other. Who has primary taxing rights will depend on the income in question and the tax residence of the individual.

The above is general advice and non specific.

An element of tax planning in advance of any move can make very real practical savings