Working in Ireland

[tigerinopen]

Hi,

Contract in Netherlands did not come through but now I have a 6 monthly contract on offer in Dublin (Ireland). I guess I can work in Ireland though UK limited company but wont be paid VAT. I will be paid in Euros.

is IR35 still applicable if my contract is in Ireland?

Anything else that I should find out?

I will be looking for a mortgage in 6 months time, will it make sense to go via umberella in that case?. I was doing permanent until 4 months ago when lost my job.

Please advice on two options from tax and deductions point of view.

Regards,

[stek]

If it's in Dublin hope it's a good rate!

[northernladuk]

What is it with no one using the search options today?

http://forums.contractoruk.com/accou...5-ireland.html

If you go umbrella IR35 isn't a consideration obviously.

[tigerinopen]

Hi, please can you/someone suggest, shall I go via a limited company or umbrella considering we will be looking for a mortgage in few months from now.


I will have to open my limited company and do not have prior company account history.

[Old Greg]

Hi, please can you/someone suggest, shall I go via a limited company or umbrella considering we will be looking for a mortgage in few months from now.


I will have to open my limited company and do not have prior company account history.

I approached Icon Accounting recently when I was looking at a contract. They were helpful and their introductory email said:

Hi OG,

Many thanks for your enquiry.

In relation to the differences with the UK, the Dividend system does not work out the same as in the UK. In Ireland Dividends are taxed the same as Income after Corporation tax has been taken. Therefore it is inefficient to take out a dividend through Irish Limited company. The main three ways of extracting funds are taxed salary, business expenses and pension contributions.

I have attached our brochure of services which outlines the different options available to consultants for the management of invoicing/payroll:

1) Setting up your Own Personal Limited Company
2) Director Member of an Umbrella Company
3) PAYE Member of an Umbrella Company

The first option of setting up your Own Personal Limited Company is suited to long term contractors, 12+ months. We will assist in you with the incorporation of your company and registration of VAT with the Revenue Commissioners. A separate bank account must also be set up for the Personal Limited Company. Please note VAT Registration can take up to 2 weeks depending on the Revenue District.

Under the Director Member Option, the above process does not apply where we can set you up straight away without any delay. As a director, we will assign you to one of our Umbrella Companies. This structure is very similar to having your own Personal Limited Company, with contractors paying Class S PRSI and having the ability to claim for the same range of expenses as in a PLC.

This option is suited for high rate consultants and/or who will incur a lot of expenses, or those relocating.

Given that you are treated like a self-employed person, you will require to complete an income tax return next year. This is not required under the PAYE Umbrella Solution.

The PAYE Member Option is most suited to consultants that have basic expenses and who wish to maintain their Class A PRSI contributions to Job Seekers/Illness Benefit. As a PAYE Member of the Umbrella Company, there is an obligation on the company to remit employers PRSI of up to 10.75%. This amount is taken as a deduction from the contractors gross pay. However contractors receive the PAYE tax credit of €1650, which helps off set this.

Our management fee for the PAYE Option is €25 per week and €95 per month and €40 per week and €140 per month for the Director Member Option .

This is a pay as you use service with no sign up or leaving charges.

If you wish to advise on the following information I will happily send sample payslips under our different structures:

· Hourly rate of pay
· Will you have many business expenses?
· Single/Married person tax credits
Contractors of the Umbrella Company/PLC also have the benefit of claiming tax relief on any business expenses that are wholly and necessarily required for the contract.
Examples of such expenses include;

· Mobile Phone - You may claim tax relief on the full cost of your mobile phone cost if required for calls for the purposes of the contract. Receipts may be in the form of a bill or top up vouchers.

· Home Phone - You may claim tax relief on up to 50% of home phone for calls required for the purposes of the contract.

· Internet - Tax Relief may be applied to 100% of internet costs which are required for the contract.

· Business Travel - Tax Relief may be applied to 100% of business travel costs. Please note travelling to and from your normal place of work is not permitted as a business expense as per Revenue Guidelines. If however you are using public transport (excluding taxis) travelling to/from the contract you may receive tax relief on the full costs of your bus/train costs.

· Professional Subscriptions & Seminar – Tax Relief may be claimed on professional subscriptions & seminars required for the contract.

· Educational Courses Books & Journals - Tax Relief may be claimed on Educational Courses Books & Journals. Please note tax relief cannot be applied in advance of the completion of courses. All courses must be necessary required for the contract and completed within the duration of the contract.

· Relocation Expenses– If required to relocate accommodation for a contract, contractors may tax relief on the full accommodation costs for the first three months of the contract. This business expenses is permitted under the Director Umbrella Company Option/Personal Limited Company Option.

· Postage & Stationary Tax Relief may be applied to the full costs of items required for the contract.

For larger stationary items and equipment – i.e. Phone / Laptop / Printers, the receipt of the equipment must be made out in the name of the Umbrella Company or Personal Limited Company. For contractors operating under the Director Umbrella Company, tax relief will be processed over a period of 6 months.
Please note business equipment is not permitted as an allowable expenses under the PAYE Umbrella Option.

If you wish to advise on the approximate costs of your business expenses, I will include this in the sample payslip.

[tigerinopen]

Can I choose to go with a UK based umbrella company,

Would that mean I don't pay any taxes in Ireland?

[stek]

Would that mean I don't pay any taxes in Ireland?

After 183 days in Ireland you should and possibly before, it the tax authorities deem you to have a management presence in Ireland.

My advise is to stay under the radar, stay in hotels and move around - make sure you've no trace of Irish presence, not because Irish tax is so high, it's not so bad, just it's more accounting...

And make sure you have deep pockets, Dublin can be more expensive than Zurich...

[tigerinopen]

And I believe that would be true if I go via my own limited company option I.e 183 day rule.

Also can someone shed light on : whether taxes are applied after or before expense claims if contract falls in IR35?

I am now keen on limited company option based in UK , pay my taxes here. Hopefully claim expenses on air travel and living costs there. Contract is only for 6 months.

Thanks to all for the help.

[stek]

Don't forget to register on the EC Sales List and include the agents Vat number on your invoice with a sterling conversion.

Also account for converting euros to sterling.

[tigerinopen]

Don't forget to register on the EC Sales List and include the agents Vat number on your invoice with a sterling conversion.

Also account for converting euros to sterling.

Thanks for writing, I am told I won't be paid vat as my company would be registered in UK. Why agents vat number on invoice and conversion rate is fluctuating. I am still wondering whether to open a euro or pound business account? Any suggestions ?