UK Income

Darkest Horse

I'm sure this has been answered loads of times and people are rolling their eyes at the question but I've found it surprisingly difficult to get a clear answer. I'm living in the UK but have a property in Ireland for which I am liable for tax on rental income. A friend of mine mentioned that I wouldn't have much tax to pay on this depending on the amount of money I've made in the UK. Forgive me if I'm off the mark but the "depending on how much you made in the UK" bit absolutely jumped out at me considering I do not live in Ireland and have not done so in around two years. Surely the Irish revenue has no right to tax me on (or even know about) money I make living in the UK? I know plenty of people living abroad who have never mentioned paying tax back in Ireland.

Cheers,
DH

nompere

Darkest Horse wrote: »

I'm sure this has been answered loads of times and people are rolling their eyes at the question but I've found it surprisingly difficult to get a clear answer. I'm living in the UK but have a property in Ireland for which I am liable for tax on rental income. A friend of mine mentioned that I wouldn't have much tax to pay on this depending on the amount of money I've made in the UK. Forgive me if I'm off the mark but the "depending on how much you made in the UK" bit absolutely jumped out at me considering I do not live in Ireland and have not done so in around two years. Surely the Irish revenue has no right to tax me on (or even know about) money I make living in the UK? I know plenty of people living abroad who have never mentioned paying tax back in Ireland.

Cheers,
DH

You probably need professional assistance.

As a general rule Irish Revenue will always tax Irish rents, no matter where the owner is resident.

As a 2nd general rule, tenants must deduct tax from rents paid to a non-resident landlord - and may find themselves personally responsible for that tax if they haven't deducted it.

As a 3rd general rule, Irish Revenue don't tax non-residents on income arising outside Ireland.

As a 4th general rule the UK Revenue are entitled to tax Irish rents, subject to a credit for the Irish tax already paid.

Darkest Horse

Thanks for that, I appreciate it. Re the first rule, yes I'm aware that I have to pay tax on the rental income to revenue no matter where I am resident.

Re rule two- that is taken care of.

Re rule three - that is where my confusion was so I'm assuming that my UK income is not actually subject to tax in Ireland?

Re rule four - I wasn't even aware of this and my UK accountants never even mentioned it. The way I saw it, I would pay tax on Irish income in Ireland and on UK income in the UK (which I have done).

CIARAN_BOYLE

Darkest Horse wrote: »

Thanks for that, I appreciate it. Re the first rule, yes I'm aware that I have to pay tax on the rental income to revenue no matter where I am resident.

Re rule two- that is taken care of.

Re rule three - that is where my confusion was so I'm assuming that my UK income is not actually subject to tax in Ireland?

Re rule four - I wasn't even aware of this and my UK accountants never even mentioned it. The way I saw it, I would pay tax on Irish income in Ireland and on UK income in the UK (which I have done).

Assuming you are UK resident; you make an Irish tax return where you disclose your UK income and you get tax credits on the basis of a formula which includes Irish Income/worldwide income.

Then depending on domicile and residency you may have to include your Irish income on your UK return and get a tax credit for any Irish taxes paid.