Employed from Ireland, Living in UK

PickMeUp_89

Hi all, I'm new to this forum so apologies if this question has been asked prior.

I am an Irish citizen (by birth) currently employed and living in London, UK since 2013. 

Due to personal reasons, I am looking to move to Scotland over the coming months and I am working with my employer to agree to a new work arrangement whereby I would work remotely from Scotland for 2.5 days a week and commute to Ireland to work in the Dublin office for 2.5 days (2 nights) each week. This would involve 1) being re-contracted to an Irish contract with my employer and the ending of my current UK contract with them and 2) getting paid in euros by my employer’s Irish entity.

I wanted to understand what this new work arrangement would mean in terms of tax and social security obligations for both Ireland and UK. I am familiar at a high-level with double taxation agreements but unclear how that would translate down to real-life practicalities for my finances and want to ensure I am not negatively impacted by this move. 


I know I'll likely need to speak to a professional tax adviser during this process but wanted to see what I could glean online first. Welcome any advice you folks may have. 

Thanks in advance!
PickMeUp_89

gerrybbadd

PickMeUp_89 wrote: »

Hi all, I'm new to this forum so apologies if this question has been asked prior.

I am an Irish citizen (by birth) currently employed and living in London, UK since 2013. 

Due to personal reasons, I am looking to move to Scotland over the coming months and I am working with my employer to agree to a new work arrangement whereby I would work remotely from Scotland for 2.5 days a week and commute to Ireland to work in the Dublin office for 2.5 days (2 nights) each week. This would involve 1) being re-contracted to an Irish contract with my employer and the ending of my current UK contract with them and 2) getting paid in euros by my employer’s Irish entity.

I wanted to understand what this new work arrangement would mean in terms of tax and social security obligations for both Ireland and UK. I am familiar at a high-level with double taxation agreements but unclear how that would translate down to real-life practicalities for my finances and want to ensure I am not negatively impacted by this move. 


I know I'll likely need to speak to a professional tax adviser during this process but wanted to see what I could glean online first. Welcome any advice you folks may have. 

Thanks in advance!
PickMeUp_89

You've been gone from Ireland for over 4 years, so you will be not ordinarily resident for tax at this stage. It's likely you won't be here for 183 days of the year here, so this rules you out as being resident here also.

You'll still likely be considered resident in the UK for tax, and pay your tax there as you have done

PickMeUp_89

Thanks! So does that mean that despite my working 50% of my work week in Ireland and being contracted to and paid by an Irish entity, that I would still only be paying UK tax and no Irish tax or social security contributions? Would my Irish employer be deducting this from my salary and then compensating HMRC post-facto? Or would I need to do this myself?
In terms of speaking to a tax adviser, should I be speaking to one in the UK or one in Ireland?
Thanks
PickMeUp_89

gerrybbadd

PickMeUp_89 wrote: »

Thanks! So does that mean that despite my working 50% of my work week in Ireland and being contracted to and paid by an Irish entity, that I would still only be paying UK tax and no Irish tax or social security contributions? Would my Irish employer be deducting this from my salary and then compensating HMRC post-facto? Or would I need to do this myself?
In terms of speaking to a tax adviser, should I be speaking to one in the UK or one in Ireland?
Thanks
PickMeUp_89

Residency is measured on the days spent in the state, rather than how many work days you have. If you are here 2.5 days, i'd assume the other 4.5 days would be in the UK. Therefore, you'd remain resident there.

Your employer may deduct Irish tax etc from you, but you can apply for credit for this under Double taxation rules with HMRC

PickMeUp_89

Hi Gerrybbadd, 
From a taxation perspective I think I'm reasonably clear. Irish revenue taxes me and I can use that as credit to offset my tax obligations to HMRC. I assume that, given the difference in tax rates and bands, if what the Revenue taxes me is less that what I owe to HMRC then HMRC can come after me for the delta? What if what the Revenue taxes me is greater than what I owe to HMRC - can I somehow claim this back?
What about social security? Would my PRSI and USC payments in Ireland offset my National Insurance obligations in UK? Or, given that I am resident in UK, would I even be charges PRSI and USC?

nompere

The nature of double taxation treaties is that you end up paying the higher of the two amounts of tax.

So if the UK tax is higher than the Irish tax you'll pay the difference in the UK.

If the Irish tax is higher than the UK tax then your credit will reduce the UK tax to nil, and that will be that.

The EU treaty that deals with national insurance broadly means that you only pay in one jurisdiction - usually where your links are closer. How that will survive post-Brexit is another matter.

PickMeUp_89

Thanks!
So the same principals and provisions that cover double taxation of income can also be applied for social security / national insurance? I pay PRSI and USC in Ireland and this counts toward my NI contribution in the UK? Is it possible to arrange such that I don't pay PRSI and USC in Ireland and I manage by NI contributions directly with the UK?

namenotavailablE

This Statement of Practice may be useful:

http://www.revenue.ie/en/tax-professionals/statements-of-practice/2007/sp-it-3-07.pdf

Also, re PRSI, you should check out if an "A1 Portable Document" (also called a "Certificate of Coverage") could exempt you from Irish PRSI.

Mrs OBumble

http://borderpeople.info/ has a lot of useful information for you.

PickMeUp_89

Thanks all for the useful info!