Ireland Individual Tax Guide

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Jim Ryan +353 (1) 221-2434 Email: jim.ryan@ie.ey.com

Michael Rooney +353 (1) 221-2857 Email: michael.rooney@ie.ey.com

Sarah Connellan +353 (1) 221-1514 Email: sarah.connellan@ie.ey.com

Stephanie Bowe +353 (1) 221-1856 Email: stephanie.bowe@ie.ey.com

Marie Caulfield +353 (1) 221-1416 Email: marie.caulfield@ie.ey.com

Owen Coyle +353 (1) 221-2970 Email: owen.coyle@ie.ey.com

Rachel Dillion +353 (1) 221-2554 Email: rachel.dillion@ie.ey.com

Aileen Downes +353 (21) 493-7697 (resident in Cork) Email: aileen.downes@ie.ey.com

Sinead Langan +353 (1) 221-2443 (Immigration) Email: sinead.langan@ie.ey.com Jennifer Sweeney +353 (1) 479-4007 Email: jennifer.sweeney1@ie.ey.com

Private Client Services contact

Alison McHugh +353 (1) 221 2180 Email: alison.mchugh@ie.ey.com

The rules regarding work permits and self-employment discussed in Section G of this chapter are regularly changed. Because of these changes, readers should obtain updated information before engaging in transactions.

A. Income tax

Who is liable. Income tax liability in Ireland depends on an indi vidual’s tax residence and domicile.

The tax year is the calendar year. For the 2021 tax year, an indi vidual is regarded as an Irish tax resident if he or she meets any of the following conditions:

• He or she spends 183 or more days in Ireland during the period from 1 January 2021 to 31 December 2021.

• He or she spends an aggregate of 280 or more days in Ireland during the two-tax-year period from 1 January 2020 to 31 December 2021, with more than 30 days in Ireland in each tax year.

• He or she elects to become tax resident for the tax year in which he or she comes to Ireland with the intention to be tax resident in the following tax year, and is tax resident under one of the tests listed above in that following tax year.

An individual is considered as present for a day if he or she is present in Ireland at any time during that day.

Tax concessions may apply in the year in which an individual becomes, or ceases to be, Irish tax resident.

An individual becomes ordinarily tax resident in Ireland after being tax resident for three consecutive tax years. An individual who is ordinarily tax resident and who ceases to be tax resident in Ireland is treated as continuing to be ordinarily resident for three tax years after the tax year of departure.

Domicile in Ireland is not defined in the tax law but is a legal concept based on the location of an individual’s permanent home. Irish law treats domicile as acquired at birth (usually it is the domicile of the father) and retained until an individual takes positive steps to change to another domicile.

Individuals who are tax resident in Ireland are normally subject to tax on worldwide income, including employment income, regardless of whether the employment is carried on in Ireland or abroad. However, exceptions can apply to the following individuals:

• Foreign-domiciled individuals

• Individuals who commute to work outside Ireland and pay tax on the income from the employment outside Ireland

Individuals domiciled outside Ireland are entitled to a remittance basis of assessment in Ireland on investment income arising out side Ireland and on income from employment duties performed outside Ireland, to the extent that the employment income is paid outside Ireland under a foreign employment contract.

If an individual is on Irish payroll, Pay-As-You-Earn (PAYE) withholding must be accounted for on all employment earnings, including benefits. If an individual is on a payroll outside Ireland, PAYE withholding is required on the amount of employment earnings (including benefits) attributable to duties performed in Ireland. An exemption may apply if the employee is resident in a treaty jurisdiction and spends less than 60 workdays in Ireland during the relevant tax year. There may also be an exemption from PAYE if the employee spends more than 60 workdays but less than 183 days in Ireland. Certain strict conditions must be met for these exemptions.

Advance approval may be granted by the Irish Revenue on the proportion of the earnings to which PAYE should be applied if earnings are paid outside Ireland and if the proportion is unclear and only a portion of the earnings is likely to be assessable in Ireland.

Tax relief is available to certain non-domiciled employees who are assigned to work in Ireland.

The Special Assignee Relief Programme (SARP) is available to employees who are assigned to Ireland by a relevant employer. For this purpose, a relevant employer is a company incorporated and resident in a country with which Ireland has entered into a double tax treaty or an information exchange agreement, or an associated company of such a company. Originally the relief was only available if the assignment began in 2012, 2013 or 2014. However, this has been extended to include assignments com mencing up to the end of 2022.

Under SARP, a relief from income tax on 30% of employment income in excess of EUR75,000 is granted for up to a maximum of five consecutive years. Effective from 1 January 2019, a ceil ing of EUR1 million applies to the income eligible for relief. In addition, the cost of one return trip to certain home locations per year for the employee and his or her spouse and children can be provided tax-free. Also, the employer can pay or reimburse taxfree education costs of up to EUR5,000 per year per child. The relief is available to individuals who earn a base gross salary of at least EUR75,000 per year and who perform their employment duties in Ireland for a minimum period of 12 consecutive months. The employee must not have been resident in Ireland for the five years immediately preceding the year of arrival and must have worked for the foreign employer for at least 6 months before arrival (12 months for individuals who arrived in Ireland before 1 January 2015). In addition, employees who arrived in Ireland before 2015 were required to be tax resident in Ireland in the year in which relief was claimed and must not have been tax resident elsewhere. Employees arriving in Ireland in the period of 2015 through 2022 can be tax resident in another jurisdiction if they are also tax resident in Ireland.

Under an application procedure for the relief, the employer must certify within 90 days of the employee arriving in Ireland to first perform duties that the employee meets the conditions for SARP relief. The Irish Revenue has advised that because the 90-day deadline is provided for in legislation, they will not accept appli cations after the deadline. SARP relief applies to income tax only and does not apply to the Universal Social Charge (USC) or social security. An individual is regarded as a chargeable person for any tax year in which SARP relief is claimed and the indi vidual must file an income tax return through the self-assessment system for that year.

Nonresidents are generally subject to Irish tax on income arising in Ireland, unless they are protected by the provisions of a double tax treaty.

The Foreign Earnings Deduction (FED) applies to individuals employed by companies expanding into emerging markets who assign Irish-based employees to perform their employment duties in these markets. The relief applies to employees assigned to the following jurisdictions for the years 2012 to 2022.

Algeria India Qatar

Bahrain Indonesia

Russian Federation Brazil Japan Saudi Arabia

Chile Kenya Senegal China Mainland Korea (South) Singapore

Colombia Kuwait South Africa

Congo Malaysia Tanzania

(Democratic Mexico Thailand Republic of) Nigeria United Arab Egypt Oman Emirates

Ghana Pakistan Vietnam

The relief reduces the income tax liability of the relevant indi vidual by allowing a deduction of up to EUR35,000 against employment income. It is claimed through the annual tax return. To qualify for the relief, the individual must spend 30 (previ ously 40) qualifying days in a tax year or in a continuous 12-month period in the relevant countries. To count as a qualify ing day, a day must be one of three consecutive days throughout which the individual is working in the relevant countries. Days spent traveling to and from the work location count as qualifying days for the purposes of the relief. The deduction does not apply to employees paid out of state revenue, such as civil servants, Gardaí (members of the Irish state police) and similar employees.

Income subject to tax. The taxation of various types of income is described below.

Employment income Most payments made by an employer, including salary, bonuses, benefits in kind, certain equity income and expense allowances, are subject to income tax.

In general, noncash benefits are taxable and are valued at the cost incurred by an employer in providing the benefits. However, special measures govern the valuation of the following taxable benefits:

• Car: The assessable benefit is up to 30% of the original market value of the car. The taxable benefit is reduced if the employee makes a financial contribution to the employer or if the employee has business mileage in excess of 24,000 kilometers in a year. From 2023 onward, the assessable benefit will be determined by reference to the vehicle’s CO2 emissions.

• Loans: 13.5% of the amount of the loan, with a reduction for interest paid by the employee. The rate is 4% for a home loan.

• Housing: The annual market value of the rent (the amount a landlord would charge an unconnected tenant to use the prop erty) plus utilities paid by the company (employer-owned accommodation) or rent plus utilities paid by the company (accommodation not owned by the employer).

Employee benefits that are incurred wholly, exclusively and nec essarily in the performance of employment duties, are not taxable. Travel expenses from home to work and from work to home may be an exception to this rule.

Education allowances provided by employers to their employees’ children 18 years of age and under are taxable for income tax and social security tax purposes.

Employers must withhold Pay Related Social Insurance (PRSI; see Section C) and the USC (see Section B) and apply the PAYE system (see Section D) with respect to the value of benefits in kind provided to employees during the tax year. Employers’ PRSI at a rate of 11.05% also applies to any benefits provided to employees.

In general, nonresidents are subject to income tax on employ ment income, regardless of their domicile, if their duties are carried on and if their salary is paid in Ireland.

Self-employment and business income. Individuals resident in Ireland are subject to tax on income from trades and professions carried on in Ireland and abroad. Nonresidents are taxed on income from trades and professions carried on in Ireland only. Taxable profits normally consist of net business profits as disclosed in the financial accounts and adjusted to account for deductions not allowed or restricted by tax legislation.

Except for years when a business begins or terminates, taxable profits generally are those for the tax year ending 31 December or for the 12-month accounting period ending in that year.

Investment income. An individual resident and domiciled in Ireland is taxed on worldwide dividend and interest income. If resident but not domiciled, an individual is taxed on all investment income arising in Ireland and on income remitted to Ireland from other countries. A credit for foreign taxes paid may be avail able if a double tax treaty applies. A nonresident and not domi ciled individual is taxed on Irish-source income only.

Dividends received by individuals from Irish tax-resident compa nies are taxed in full, subject to relief being available under a rel evant double tax treaty. Dividends may be subject to withholding tax at a rate of 25%, which is creditable against a resident indi vidual’s income tax liability.

Interest on Irish government securities is subject to income tax and is generally not taxed at source, but may not be taxable if received by nonresident individuals.

Interest credited on or after 1 January 2020 on most bank and building society deposits is taxed at source at a rate of 33%, unless it is paid or credited to nonresidents. A credit is given for tax withheld if the person is taxed on the interest. The final income tax on deposit interest taxed at source is 33%.

Losses from Irish rental properties may be offset against other Irish-source rental income or may be carried forward indefinitely and offset against rental income in future years.

Nonresidents are subject to a 20% withholding tax on nonexempt interest, royalties and rental income.

Directors’ fees. Directors’ fees paid by companies incorporated in Ireland are taxable in Ireland, regardless of the tax residence of the director or the place where duties are performed. Directors’ fees paid by non-Irish companies to Irish residents are taxable in Ireland. Non-domiciled individuals do not pay tax on directors’ fees received from foreign companies if all of the duties are per formed outside Ireland unless that income is remitted to Ireland.

Directors are regarded as employed for tax purposes and as either self-employed or employed for social insurance purposes, depend ing on the circumstances. Tax is withheld under the PAYE system (see Section D) on the basis of income earned during the tax year.

Directors must submit personal tax returns by 31 October follow ing the tax year.

Exempt income A portion of income from the following sources is exempt from income tax:

• For tax-resident individuals only, income derived from writing books and plays, composing music, painting and sculpting. This exemption is limited to profits or gains of EUR50,000. Such income is liable to the USC and PRSI.

• Profits or gains from forestry activities. Such income is liable to the USC and PRSI.

• Shares provided to an employee under an Approved Profit Sharing Scheme, up to a value of EUR12,700 in a tax year. Such income is liable to the USC and employee PRSI.

An individual may use the first two reliefs mentioned above to reduce the tax liability, subject to restrictions. An individual effectively pays income tax at a minimum rate of 30% if his or her total income exceeds EUR400,000 and if sufficient specified tax reliefs are claimed. The effective tax rate for individuals with total income between EUR125,000 and EUR400,000 is lower because the restriction applies on a tapering basis. For individuals whose total income is less than EUR125,000, the restrictions to the tax relief do not apply.

Taxation of employer-provided stock options. Employer-provided share options are subject to income tax, Universal Social Charge (USC; see Section B) and employee PRSI at the date of exercise on the market value of the shares at the date of exercise, less the sum of the option and exercise prices. Effective from 5 April 2007, a gain arising on the exercise, assignment or release of certain share options granted on or after 1 January 2006 is subject to income tax and employee PRSI in Ireland by reference to the number of workdays spent in Ireland during the vesting period. The employee is required to account for income tax PRSI and USC within 30 days of exercise. Effective from 1 July 2012, the responsibility for payment of employee PRSI rests with the employee (before this date, the employer was required to withhold employee PRSI on share option gains through the payroll).

For gains arising after 1 January 2004, an individual may claim a tax credit for foreign taxes paid on the same option gain in a juris diction with which Ireland has entered into a double tax treaty. If an income tax charge arises in a non-treaty country, Ireland reduces the gain subject to Irish income tax by the tax payable in the other jurisdiction.

On the disposal of shares, capital gains tax is charged on the difference between the market value of the shares at the date of exercise and the market value at the date of disposal.

If the option is capable of being exercised in a period exceeding seven years after the date of grant, income tax may be charged at the date of grant in addition to a charge at the date of exercise.

Restricted stock units (RSUs) are generally taxed at the date of vesting. Individuals are liable to Irish tax on RSU gains by refer ence to their tax residence on the date of vesting. As a result, the full gain is liable to Irish tax if the individual is tax-resident in Ireland on the date of vesting and no charge to Irish tax arises if

the individual is nonresident in Ireland at the date of vesting. A credit for foreign tax payable is allowed against the Irish liability. RSUs are liable to PAYE, USC and employee PRSI, and are tax able through payroll.

Employers must withhold the following from payroll:

• The USC on the taxable value of all share awards (excluding share option schemes; the employee is required to account for USC within 30 days of exercise)

• Employee PRSI contributions (excluding share option schemes; the employee is required to account for PRSI within 30 days of exercise)

• PAYE on share schemes that are not Revenue approved (exclud ing share option schemes; the employee is required to account for tax within 30 days of exercise)

Capital gains and losses. Individuals resident in Ireland generally are subject to tax on worldwide capital gains. Non-domiciled individuals are not taxed on gains arising outside Ireland unless the proceeds are remitted to Ireland. Capital gains are taxed at a rate of 33% for disposals on or after 6 December 2012.

Nonresidents are taxable on capital gains derived from the fol lowing assets located in Ireland:

• Land and buildings

• Mineral rights

• Exploration or exploitation rights on the Continental Shelf

• Assets used by a trade carried on in Ireland through a branch or agency

• Shares that derive the greater part of their value from the first three items listed above

Gains are calculated by deducting from the proceeds the greater of the cost of the asset or, if the asset was owned by the seller on 6 April 1974, its value on that date. Cost (or the 1974 value) is increased by an index factor to adjust for inflation up to 31 December 2002. The value of the asset cannot be increased for inflation beginning 1 January 2003. Indexation relief is also restricted on land situated in Ireland that is held for development and on shares that derive the greater part of their value from such land.

Exemptions are available for the following capital gains:

• The first EUR1,270 of taxable gains derived during the 2021 tax year

• Capital gains derived from the taxpayer’s principal residence

• Assets transferred on death

• Wasting chattels if the consideration is EUR2,540 or less (that is, tangible movable property with a useful life of less than 50 years)

Retirement relief or entrepreneurial relief for capital gains may be available, subject to certain conditions.

Capital losses may be offset against capital gains derived in the same year or carried forward to offset against capital gains in future years.

Income tax deductions

Deductible expenses Few deductions are allowed for employees. To claim a deduction, an employee first must show that the expense

was incurred wholly, exclusively and necessarily in the perfor mance of the duties of the employment. Tax deductions for expenses incurred by employees are granted only for exceptional items, including purchases of protective clothing.

Personal credits and allowances. The principal credits for the 2021 tax year are listed in the following table. Credits are deducted from the individual’s income tax liability.

Credits Amount (EUR)

Married persons/civil partners (jointly assessed) 3,300 Single person 1,650

Widowed person/surviving civil partner 2,190 Widowed person/surviving civil partner in year of bereavement 3,300 Pay-As-You-Earn (PAYE) allowance (if salary is subject to tax at source) 1,650 Medical and dental insurance 20% of the gross premium*

* The relief with respect to premiums is restricted to EUR1,000 per adult policy and EUR500 per child policy.

The principal allowances for the 2021 tax year are listed in the following table. Allowances reduce the amount of income of the individual that is taxable at the top income tax rate.

Allowance at top rate Amount

Pension contributions to Varies from 15% to 40% approved schemes (a)(b) of earnings, depending on age of individual

Employment and Investment Incentive EUR250,000/EUR500,000 (c) Startup relief for entrepreneurs EUR100,000 (d) Employee Approved Profit Sharing Scheme EUR12,700

(a) Effective from 1 January 2014, the maximum allowable pension fund for tax purposes is set at EUR2 million. Higher thresholds may apply if the value of the pension fund, as of 1 January 2014, exceeds EUR2 million, but does not exceed EUR2,300,000. Any excess is subject to a one-off charge of 40% on drawdown.

(b) Pension contributions are subject to an earnings cap of EUR115,000. (c) The allowance is EUR250,000 for a minimum four-year holding period and EUR500,000 for a minimum seven-year holding period. (d) The allowance can be used to reduce taxable income in one or more of the preceding six tax years.

In general, a nonresident is not entitled to tax credits or personal allowances, but exceptions may apply under Irish income tax law or the provisions of a double tax treaty.

Business deductions and capital allowances. Expenses incurred wholly and exclusively for the purposes of a trade or profession are generally deductible. Entertainment expenses for staff func tions are deductible if they are reasonable in amount. All other entertainment expenses are not deductible. Deductions for auto mobile expenses are restricted.

Rates. The following table presents the 2021 income tax rates for single or widowed individuals, or a surviving civil partner.

Taxable income

on lower Rate on

Not exceeding amount excess EUR EUR EUR %

20

The following are the 2021 income tax rates for a married couple or civil partners (jointly assessed).

Taxable income

on lower Rate on Exceeding Not exceeding amount excess EUR EUR EUR %

20

40

If both spouses or civil partners have income, married couples or civil partners may have more of their income taxed at the 20% rate. The income bracket is increased by EUR1 for every EUR1 received by the other spouse or civil part ner, up to a maximum additional EUR26,300. Consequently, for a married couple or civil partners, the maximum amount of taxable income potentially subject to the 20% rate is EUR70,600.

Nonresidents are taxed at the same rates as residents.

Relief for losses. A loss arising from a trade or profession, as calculated for income tax purposes, may be offset against all income for the tax year in which the loss is incurred, or may be carried forward indefinitely and offset against income from the same trade or profession in future years; however, the loss must be used as early as possible in the years when a profit arises. A loss incurred in the final 12 months of a trade or profession may be carried back and offset against profits from the same trade or profession for the three tax years prior to the year of cessation.

B. Other taxes

Universal Social Charge.

Universal Social Charge (USC) is

income

income is exempt if income does not exceed

The 11% rate applies to “relevant income,” excluding employment income that exceeds EUR100,000. Consequently, the 8% rate applies to employment in come exceeding EUR100,000.

USC applies to all income, including noncash benefits-inkind and equity compensation under an unapproved scheme, subject to certain exceptions. It applies to all income before relief for pension contributions and deductions for capital allowances.

persons

required to pay the USC as part of preliminary tax (see Section D). Employers deduct the USC from payments to employees

the rates

above.

Inheritance and gift tax. Capital Acquisitions Tax (CAT) includes both gift and inheritance tax and is primarily payable by the beneficiary of a gift or an inheritance.

CAT is payable if any of the following conditions are met:

• The disponer is resident or ordinarily resident in Ireland. If the disponer is not domiciled in Ireland, he or she is not regarded as resident or ordinarily resident for CAT purposes unless he or she has been resident in Ireland for five consecutive years immedi ately preceding the year of the gift or inheritance.

• The beneficiary is resident or ordinarily resident in Ireland. If the beneficiary is not domiciled in Ireland, he or she is not regarded as resident or ordinarily resident for CAT purposes unless he or she has been resident in Ireland for five consecutive years immediately preceding the year of the gift or inheritance.

• The gift or inheritance consists of Irish property.

CAT is imposed at a rate of 33% for gifts and inheritances received on or after 6 December 2012. It is payable on the amount exceeding the relevant tax-free threshold. Three tax-free thresh olds exist. The thresholds vary depending on the relationship between the disponer and the beneficiary. The following are the relevant thresholds.

Threshold When Group EUR applicable

A 335,000

B 32,500

C 16,250

If the beneficiary is a child (including certain foster children), or minor child of a deceased child of the disponer; parents also fall within this threshold if they receive an inheritance from a child

If the beneficiary is a brother, sister, niece, nephew or lineal ancestor or lineal descendant of the disponer

All other cases

Any benefit received since 5 December 1991 within the same group threshold is aggregated for the purposes of determining whether any CAT is payable on the current benefit.

An exemption from CAT applies to gifts or inheritances received by a spouse or civil partner. Gifts of EUR3,000 or less are also exempt. Relief from CAT is available on gifts or inheritances of agricultural property and business property.

Ireland has entered into inheritance tax treaties with the United Kingdom and the United States.

Local Property Tax. Effective from 1 July 2013, an annual Local Property Tax (LPT) is charged on all residential properties in the Republic of Ireland. The LPT is due with respect to residential properties on a specific ownership date in any given year. For 2013, the ownership date was 1 May 2013. Residential property valuations for 2014 to 2020 remain similar to the valuations used for 2013 (even if improvements are made to the property). The next valuation date for LPT is 1 November 2021. The standard rate of LPT is 0.18% for property up to a market value of EUR1 million and 0.25% on the excess over EUR1 million. The rates can be increased or decreased by 15% by the relevant local authorities.

C. Social security

Rates. Ireland imposes payroll taxes for Pay Related Social Insurance (PRSI) on all employment income, including most benefits. The following are the rates of social security contribu tions for 2021.

Social security taxes

Contribution rate (a) PRSI; paid by Employee 4% on gross income (no maximum income) Employer 11.05% on gross income (no maximum income) (b) Self-employed 4% on gross income (no maximum income) (c)

(a) If weekly earnings are EUR352 or less, employee contributions are nil. (b) If weekly earnings are EUR398 or less, employer PRSI is calculated at 8.7%. (c) The minimum annual PRSI contribution is EUR500.

A PRSI credit, which reduces the amount of PRSI payable, is available for employees earning between EUR352.01 and EUR424 per week. The credit is calculated by subtracting onesixth of the employment income over EUR352.01 from the maximum credit of EUR12.

Social insurance. Employed persons between the ages of 16 and pensionable age (currently 66) must pay PRSI. A contribution is also payable by employers. Self-employed persons between the ages of 16 and pensionable age (currently 66) with earnings of EUR5,000 or more per year must pay PRSI.

Self-employed persons pay PRSI on total income, including unearned income. Employed persons pay PRSI on income from employment, including benefits in kind. Employed persons also pay PRSI on unearned income if they are regarded as chargeable persons. An employed person is regarded as a chargeable person if they have non-employment income and if he or she meets either of the following conditions:

• His or her net assessable non-employment income is more than EUR5,000 on the year.

• His or her total gross non-employment income is EUR30,000 or more in the year.

The payment of PRSI contributions may secure the following benefits:

• Contributory old-age pension (for employees and self-employed persons)

• Unemployment benefits (now known as Jobseekers Benefits; for employees only)

• Sickness benefits (for employees only)

• Limited dental benefits (for employees only)

• Limited medical (optical and hearing) benefits (for employees only)

PRSI is payable by individuals employed in Ireland. However, non-European Economic Area (EEA) nationals, other than individuals from Australia, Canada, Japan, Korea (South), New Zealand, Quebec, Switzerland and the United States, are exempt for the first 52 weeks of their assignment in Ireland if the assignment is temporary and if the employer’s principal place of

business is outside Ireland, the Isle of Man and the United Kingdom. An application must be made to the Department of Social Protection to exempt such individuals from Irish PRSI.

Individuals from the EEA and nationals from Australia, Canada, Japan, Korea (South), New Zealand, Quebec, Switzerland and the United States may remain covered by their home-country social insurance systems for a specified time period. An application must be made to the relevant authorities to apply for an A1 Certificate/Certificate of Coverage in this regard.

Ireland also has an agreement with the Isle of Man and the Channel Islands (Alderney, Guernsey, Herm, Jersey and Jethou).

Some individuals leaving Ireland on short-term assignments may remain covered under the Irish PRSI system for a limited period, subject to approval from the Department of Social Protection.

D. Tax filing and payment procedures

Filing. The tax year for individuals runs from 1 January to 31 Dec ember. Individuals who are subject to income tax for the tax year must file tax returns for earned and investment income and capi tal gains under the self-assessment rules. To avoid a surcharge penalty, taxpayers must file their returns by 31 October following the end of the tax year. If a taxpayer files his or her tax return and pays any related tax liability online through the Revenue’s Online System (ROS), the deadline is extended until mid-November (the exact date is set by the Revenue at the beginning of each tax year). If a return is filed late but within two months after the fil ing deadline, the surcharge is 5% of the tax liability due. If a return is filed more than two months after the filing deadline, the surcharge is 10% of the tax liability due. Interest may also be applicable.

Capital gains are included in the tax return or in a separate form for individuals not subject to income tax. Individuals with capital gains in the tax year must declare such gains by the relevant filing date (see Tax administration dates).

Non-domiciled individuals are not required to provide details of worldwide investment income or capital gains. However, they must file tax returns and supply information concerning the following:

• Details of employment earnings subject to Irish income tax

• Remittances of investment income and capital gains to Ireland during the year

• SARP relief being claimed if relevant

Non-domiciled individuals are subject to the filing dates men tioned above.

Married persons are taxed jointly or separately, at the taxpayers’ election.

Payment. Tax on salaries and benefits normally is collected through the PAYE system.

Income tax self-assessment applies to self-employed individuals. These individuals include persons receiving rental income and investment income. Ninety percent of the tax due, including the USC (see Section B), for the year or an amount equal to 100% of

the final liability of the preceding year must be paid by 31 October in the tax year to avoid an interest charge. Alternatively, income tax may be paid in 12 equal monthly installments throughout the tax year if agreement has been sought from the Irish tax authori ties. The aggregate of these installments must equal 105% of the second preceding year’s liability, and must be paid by direct debit mandate (under this system, tax payments are deducted monthly from an individual’s bank account) if the individual had income tax liability in the second preceding year. Any balance of tax due must be paid by 31 October following the end of the tax year. A limited number of cases are selected for subsequent in-depth examination by the Revenue Commissioners.

Capital gains tax on gains arising on disposals during the period from 1 January to 30 November must be paid by 15 December in that tax year, and the tax on gains arising on disposals during the period from 1 December to 31 December must be paid by the following 31 January.

Tax administration dates. The following table presents important tax administration dates for the year ending 31 December 2021.

Pay balance of 2020 income tax

liability

Due date

31 October 2021

File 2020 income tax return 31 October 2021/ 17 November 2021*

Pay 2021 preliminary tax equal to 90% of the actual income tax liability or 100% of the previous year’s final income tax liability

Capital gains tax due

31 October 2021

For period of 1 January 2021 through 30 November 2021 15 December 2021

For period of 1 December 2021 through 31 December 2021

31 January 2022

File 2021 return 31 October 2022

Balance of 2021 tax due 31 October 2022

* If a taxpayer files his is or her 2020 Irish tax return and pays any related tax liability online via the ROS, an extended deadline to 17 November 2021 is available.

E. Double tax relief and tax treaties

Ireland has entered into double tax treaties to avoid double taxa tion and to establish a right of taxation between Ireland and those countries. In general, the treaties provide for a credit for foreign taxes paid against the individual’s Irish income tax liabilities. Some treaties provide rules to determine the country where the individu al is considered to be resident for tax purposes.

Ireland has entered into double tax treaties with the following jurisdictions.

Albania Greece Poland Armenia Hong Kong Portugal Australia Hungary Qatar Austria Iceland Romania Bahrain India Russian Belarus Israel Federation

Belgium Italy Saudi Arabia

Bosnia and Japan Serbia

Herzegovina Kazakhstan Singapore

Botswana Korea (South) Slovak Republic

Bulgaria Kuwait Slovenia

Canada Latvia South Africa

Chile Lithuania Spain

China Mainland Luxembourg Sweden

Croatia Malaysia Switzerland

Cyprus Malta Thailand

Czech Republic Mexico Turkey

Denmark Moldova Ukraine

Egypt Montenegro United Arab Estonia Morocco Emirates

Ethiopia Netherlands United Kingdom

Fiji New Zealand United States

Finland North Macedonia Uzbekistan

France Norway Vietnam Georgia Pakistan Zambia Germany Panama

A double tax treaty with Ghana was signed on 7 April 2018.

If double tax treaty relief is not available, foreign income tax and foreign capital gains tax are deductible from the foreign-source income or capital gain for the purposes of computing Irish taxable income.

F. Entry visas

European Union (EU) national passport holders are classified as “non-visa required nationals.” Consequently, they are not required to apply for an entry visa for Ireland. Nationals of the following jurisdictions do not require an entry visa for Ireland.

Andorra Grenada Poland

Antigua Guatemala Portugal and Barbuda Guyana Romania Argentina Honduras St. Kitts and Nevis

Australia Hong Kong St. Lucia

Austria Hungary St. Vincent and Bahamas Iceland the Grenadines

Barbados Israel Samoa

Belgium Italy

Belize Japan

San Marino

Seychelles

Bolivia Kiribati Singapore Botswana Korea (South) Slovak Republic

Brazil Latvia Slovenia

Brunei Darussalam Lesotho Solomon Islands

Bulgaria Liechtenstein

South Africa

Canada Lithuania Spain

Chile Luxembourg Sweden

Costa Rica Macau Switzerland

Croatia Malaysia Taiwan

Cyprus Maldives Tonga

Czech Republic Malta Trinidad and Tobago

Denmark Mexico Tuvalu

El Salvador Monaco United Arab

Estonia Nauru Emirates

Eswatini

Netherlands

Fiji New Zealand

Finland Nicaragua

France Norway

Germany

Greece

Panama

Paraguay

United Kingdom

(and colonies)

United States

Uruguay

Vanuatu

Vatican City

An individual holding a non-visa required passport is not auto matically guaranteed entry to Ireland. An immigration officer at Immigration clearance has the authority to grant or deny permis sion to enter Ireland and also has the authority to decide on the duration of a person’s stay in Ireland. Consequently, an individual wishing to enter Ireland must satisfy the immigration officer at Immigration clearance that, after arrival in Ireland, the individual intends to act in accordance with their stated purpose of visit to Ireland (appropriate supporting documents at entry are important).

Non-EU national passport holders and nationals of countries not mentioned above must apply for an entry visa before their arrival in Ireland at any Irish consular office or embassy abroad, or to the Department of Justice and Equality (DJE) in Dublin.

In October 2014, the Irish authorities introduced a change for minors (under the age of 18) who are seeking a visa to enter Ireland. When a visa is issued to a minor, the visa (in his or her passport) identifies whether the minor who holds an Irish visa is traveling in the company of a parent(s), legal guardian(s) or other adult(s), or traveling unaccompanied. The visa with respect to an accompanied minor states the name(s) and passport number(s) of the accompanying adult(s), and the minor must travel into Ireland with the accompanying adult(s) named on the visa. Failure to do so can result in refusal of entry. In addition, the Irish authorities have issued further requirements regarding a minor traveling to Ireland. The immigration officer, at his or her discretion, can request proof of the relationship to a child.

Individuals over the age of 5 years who are applying for Irish visas in China Mainland, India, Nigeria or Pakistan must provide biometric data as part of their visa application.

Although an Irish entry visa affixed to an individual’s passport indicates that a person has permission to travel to Ireland during the dates stated on the visa, it does not automatically guarantee entry to Ireland. An immigration officer at Immigration clear ance has the authority to grant or deny permission to enter Ireland and also has the authority to decide on the duration of a person’s stay in Ireland. Consequently, an individual wishing to enter Ireland must satisfy the immigration officer at Immigration clearance that the individual intends to comply with the condi tions of the visa held by them at the point of entry to Ireland (appropriate supporting documents at entry are important).

In the first instance, non-EEA nationals who are traveling to Ireland with a valid employment permit are granted only a single-entry visa. In May 2019, the Irish immigration authorities abolished the re-entry visa requirement that required visarequired nationals to obtain a re-entry visa after they registered their residency in Ireland (see Section H), to travel in and out of Ireland. Going forward after they arrive in Ireland, they must apply for a residence card, which allows them to travel in and out

of Ireland while they remain resident without a separate re-entry visa. Non-EU nationals may be required to have employment permits if they intend to take up employment in Ireland. If an employment permit is required, non-EU nationals must have employment permits in their possession at the point of entry to Ireland.

In June 2014, the Irish and British governments issued a joint scheme, the British Irish Visa Scheme, which allows visitors from China Mainland and India to travel freely within Ireland and the United Kingdom on either an Irish or UK visa. As a result, tourists and business visitors may visit both Ireland and the United Kingdom, including Northern Ireland, on a single visa. This scheme applies only to individuals holding a short-stay visa (travel for up to 90 days).

G. Employment permits and self-employment

Employment permits. In October 2014, the Irish government enacted the Employment Permits (Amendment) Act 2014, which created nine categories of Irish employment permits. The follow ing are the categories of employment permits:

• Critical Skills Employment Permit (formerly Green Card)

• Intra-Company Transfer (ICT) Permit

• General Employment Permit (formerly Work Permit)

• Contract for Services Employment Permit

• Dependent/Partner/Spouse Employment Permit

• Internship Employment Permit

• Graduate Employment Permit

• Sports and Cultural Employment Permit

• Reactivation Employment Permit

Each of these categories has their own qualifying requirements and conditions. In general, EEA nationals and Swiss nationals do not require employment permits to live and work in Ireland. The Department of Enterprise, Trade and Employment (DETE) issues employment permits. Employers wishing to hire a non-EEA indi vidual are required to apply for an employment permit on behalf of the applicant. An individual may also apply for an employment permit if he or she has received a job offer that is conditional on the holding of a valid employment permit. A signed copy of the individual’s employment contract is required for the application process. In addition to employment permits, depending on their country of origin, non-EU nationals may also need an entry visa (see Section F). The categories of the most commonly used per mits in Ireland are summarized below.

Critical Skills Employment Permit. To obtain a Critical Skills Employment Permit, an individual must be employed under an Irish employment contract and paid directly from an Irish payroll. The minimum remuneration requirement is EUR64,000. Effective from 1 October 2014, remuneration can be made up of Basic Annual Salary (equal to at least the Irish National Minimum Wage) and Health Insurance Payments. Individuals in all occupa tions except those that are contrary to public interest may qualify for a Critical Skills Employment Permit.

A non-EEA national who has been offered an Irish employment contract and will be paid directly from an Irish payroll may be

eligible for a Critical Skills Employment Permit if the salary is between EUR32,000 and EUR63,999. The individual must hold a third-level qualification (at least a degree qualification) and the role must be included in the Critical Skills Occupations List.

A Critical Skills Employment Permit applies only if the offer of employment is for a period of at least two years. An initial permit is available for a two-year period (EUR1,000 fee). No more than 50% of employees of an Irish employer may be from non-EEA countries.

An individual who is granted an employment permit for the first time in Ireland is expected to stay with the initial employer for a period of 12 months.

Under a new measure, spouses or recognized de facto partners of Critical Skills Employment Permit holders are entitled to seek permission to work directly from the Immigration Service Delivery (ISD) unit. A preclearance application must be submit ted and processed for qualifying de facto partners for Critical Skills Permit holders before they can travel to Ireland (this is not required for spouses). Once the de facto partner or spouse of a Critical Skills Employment Permit holder arrives in Ireland, they can seek a Stamp 1G residence card (see Section H), which allows them to work in Ireland. This has removed the need for the Dependent/Partner/Spouse Employment Permit (but has not abolished this permit type).

De facto partners or spouses who are eligible for this permission have greater ease of access to employment in Ireland and may apply for a role with a remuneration of less than EUR30,000 per year (but not less than the Irish National Minimum Wage). They do not require a full-time position and are not restricted in the type of role in which they can work in (except those in a domes tic setting).

Extension of a Critical Skills Employment Permit. Effective from 1 April 2015, Critical Skills Employment permit holders who have completed two years of continuous employment in Ireland must submit a request to the DETE for a letter that confirms their compliance with the terms and conditions of their employment permit. If the DETE is satisfied, it issues a letter confirming this fact, and the individual must present this letter to the Garda National Immigration Bureau (GNIB) with appropriate docu mentation to apply for an extension of up to 24 months of the duration of their Irish Residence Permit (IRP) card, formerly known as the GNIB card (see Section H).

General Employment Permit. To obtain a General Employment Permit, an individual must be employed in an eligible occupation under an Irish employment contract and paid directly from an Irish payroll. The role must not be an excluded job category con tained in the Ineligible Categories of Employment for Employment Permits.

The minimum remuneration requirement is EUR30,000. Effective from 1 October 2014, remuneration can be made up of Basic Annual Salary (equal to at least the Irish National Minimum Wage) and Health Insurance Payments. The remuneration thresh old is reduced from EUR30,000 to EUR27,000 with respect to

employment permit applications under the General Employment Permit category for the following individuals:

• Non-EEA nationals in a healthcare assistant role if the indi vidual has previously been in employment in Ireland on an employment permit as a healthcare assistant for two years or more and if he or she submits a copy of his or her relevant Level 5 Quality and Qualifications Ireland (QQI) qualification

• Non-EEA graduates of overseas third-level institutions (univer sities and third-level colleges) who have graduated in the last 12 months that have been offered an Information Technology Graduate position on the Critical Skills Occupations List

• Non-EEA graduates of Irish institutions who have graduated in the last 12 months and have been offered a graduate position on the Critical Skills Occupations List

• Technical or sales support roles with non-EEA language requirements

A minimum salary of EUR27,500 applies to those in boner (meat) roles.

In addition, the employer must advertise the vacancy with the Department of Social Protection’s employment services (previ ously referred to as FAS) in national newspapers and also in local newspapers or on a jobs website, to demonstrate that it was unable to fill the vacancy with an EEA national. Individuals engaged in eligible occupations, except those that are contrary to public interest, may qualify for a General Employment Permit. A General Employment Permit is available for an initial period of either six months (EUR500 fee) or up to two years (EUR1,000 fee). After five years, an indefinite extension may be available for no fee. No more than 50% of employees of an Irish employer may be from non-EEA countries.

An individual who is granted an employment permit for the first time in Ireland is expected to stay with the initial employer for a period of 12 months.

Intra-Company Transfer Permit. To obtain an ICT Permit, an individual must be transferred to a company related to his or her employer in Ireland (that is, sister, parent or subsidiary) and must remain on a foreign employment contract and foreign payroll (full salary must be paid by the foreign employer outside Ireland). An ICT Permit is available only to senior management, key personnel and individuals who are assigned to Ireland for specific training purposes. The relevant transferee must have been working for a minimum period of six months with the over seas company before the transfer.

The minimum remuneration is EUR40,000. Effective from 1 October 2014, remuneration must be made up of Basic Annual Salary (equal to at least the Irish National Minimum Wage), board and accommodation, and Health Insurance Payments. The full Basic Annual Salary must be paid by the individual’s home country payroll, but payments with respect to board and accom modation and health insurance can be paid by either the Irish or foreign entity.

An ICT Permit is available for an initial period of six months (EUR500 fee) or two years (EUR1,000 fee). An extension for an additional three years is available (EUR1,500 fee). No further

extensions are available. No more than 50% of employees of the Irish entity can be from non-EEA countries.

A Training ICT Permit is available for non-EEA personnel who are in a training program and require a transfer to the Irish entity. This permit is granted for a 12-month maximum period, and the individual must remain on a foreign contract and foreign payroll (the home country entity must pay the full Basic Annual Salary). The minimum annual remuneration is EUR30,000. A detailed training plan must be submitted as part of the application to the DETE.

The relevant transferee (trainee) must have been working for a minimum period of one month with the overseas company before the transfer.

An individual who is granted an employment permit for the first time in Ireland is expected to stay with the initial employer for a period of 12 months.

Atypical Working Scheme. The DJE introduced the Atypical Working Scheme on 2 September 2013. This scheme covers a situation in which an employee would normally require an employment permit to work in Ireland but because of the shortterm nature of the employment (15 to 90 calendar days inclu sive), the employee is not eligible for a permit under the existing rules of the DETE.

Applications must be made to the DJE in advance of travel to Ireland. Only one application is allowed per individual in a 12-month period. The fee is EUR250.

Van der Elst ruling. Non-EEA nationals whose normal place of work is in another EU country can seek entry to Ireland under the Van der Elst ruling, which was issued by the Court of Justice of the EU. This ruling allows a non-EEA national who is legally employed by a company in an EU country to perform services in another European country on a project for a short time. The Irish authorities recognize this ruling. As a result, a non-EEA national can seek permission to remain for up to a maximum of 12 months to work in Ireland on behalf of their European employer.

Posted Worker Declaration. A posted worker is an employee sent by his or her employer to carry out a service in another EU mem ber state on a temporary basis. This applies to all nationals resid ing in the EU. EU Directive 2014/67 EU was adopted in May 2014 and further transposed into Irish law on 28 July 2016 as Statutory Instrument (SI) 412 of 2016 – European Union (post ing of workers) Regulations 2016. This legislation requires EU foreign service providers to notify the Workplace Regulations Commission (WRC) when posting workers to Ireland. A pre scribed form that requires certain information must be submitted to the WRC with respect to each posted worker. Failure to submit a declaration can result in a fine of up to EUR50,000.

Other work permit exemptions. The following individuals are not required to obtain employment permits in Ireland:

• A non-EEA national who has obtained explicit permission from the DJE to remain resident and employed in Ireland

• A non-EEA national who has been granted international pro tection (refugee status or subsidiary protection)

• A non-EEA national who holds appropriate permission under the Immigrant Investor/Start-up Entrepreneur Programme

• A non-EEA national who is a registered student working less than 20 hours a week

• Swiss nationals

Self-employment. Arising from an ongoing review of the business-, entrepreneur- and investor-related migration schemes, the Irish immigration authorities decided to suspend the Business Permission Scheme, effective from the close of business on 16 March 2016 until further notice. This does not affect applications received before 16 March 2016 or the status of persons already holding permission under the scheme.

Other immigration programs. The DJE has also introduced the programs described below, effective from April 2012.

Immigrant Investor Programme. The Immigrant Investor Programme is open to non-EEA nationals and their families who commit to an approved investment in Ireland. Approved partici pants in the program and their immediate family members are granted rights of residence in Ireland, which allow them to enter Ireland on multi-entry visas and to remain in Ireland for a defined period, with the possibility of ongoing renewal. The pro gram will facilitate the establishment over time of a permanent relationship in Ireland for the participants. Investors must have a minimum net worth of EUR2 million. To be considered for the program, an investor must propose an investment in one or more of the following categories:

• Enterprise Investment: minimum investment of EUR1 million in a single Irish enterprise or several enterprises for at least three years that supports the creation of employment.

• Investment Fund: minimum investment of EUR1 million in an Approved Investment Fund for a minimum of three years. Funds must be approved and regulated by the Central Bank of Ireland.

• Real Estate Investment Trust (REIT): minimum investment of EUR2 million for at least three years in an Irish REIT that is listed on the Irish Stock Exchange at which stage the investor may divest no more than 50% of the shares. If the shares are divested during year three, then after four years, the investor may divest no more than 25% of the shares from the date of purchase. After five years from the date of purchase, no requirements on the retention of shares apply to investors.

• Endowment: minimum investment of EUR500,000 in a project to benefit the arts, sports, health, culture or education that is regarded as a philanthropic contribution with clear public benefit.

If the required criteria are met, successful applicants can expect to receive residence permission for five years, with an initial review after the first two years, to ensure conditions are still being met. The investor is not required to establish actual resi dence in Ireland but must spend at least one day a year in Ireland.

Applications for this scheme are made to the ISD unit.

Start-up Entrepreneur Programme. Under the Start-up Entrepreneur Programme, non-EEA nationals with an innovative business idea for a High Potential Start-up and funding of EUR50,000 for the first founder (and EUR30,000 for any subsequent founders) can acquire residency in Ireland for the purposes of developing their business. No initial job creation targets are set because it is recognized that such a business can take some time to get off the ground. The intention of the pro gram is to support High Potential Start-ups, which are defined as enterprises that satisfy the following conditions:

• They introduce a new or innovative product or service to inter national markets.

• They are capable of creating 10 jobs in Ireland and realizing EUR1 million in sales within three to four years of starting up.

• They are led by an experienced management team.

• They are headquartered and controlled in Ireland.

• They are less than six years old. This scheme is not intended for retail, personal services, catering or other similar businesses.

Successful applicants can expect to receive an initial permission of two years. Following a review at this point to ensure that the entrepreneur is continuing to progress with the business propos al, a further three years will be granted. After the initial five-year period, successful entrepreneurs will be free to apply for longterm residence in five-year periods.

Applications for this scheme are made to the INIS.

H. Residence permits and naturalization

Residence permits. In general, EEA nationals and Swiss nationals are not required to apply for an Irish Residence Permit (IRP) card, formerly known as a GNIB card. Non-EEA and non-Swiss nationals who intend to remain longer than 90 days in the Dublin area must register their residency and obtain an IRP card from the centralized registration office in Dublin. In areas outside Dublin, registration takes place at the local police station.

All individuals who are 16 years of age or older must register with the local registration office to obtain their IRP card. The fee is EUR300 per registration.

Long-term residency. To obtain Irish long-term residency, an individual must have been legally resident in Ireland continu ously for over five years (60 months) on the basis of holding an employment permit (work permit, spousal permit or working authorization). The fee per application is EUR500.

Under the current policy, ICT Permit holders (those working under assignments and trainees) are not eligible to apply for longterm residency.

Naturalization (citizenship). In general, an individual applying for naturalization must fulfill several requirements, including the following:

• He or she had continuous reckonable residence (qualifying periods of lawful residence) in Ireland for the one year imme diately before the date of application.

• During the eight years preceding the year described in the first bullet, he or she had a total of four years reckonable residence in Ireland.

The fee per application is EUR175. If the naturalization is approved, the fee for certification is EUR950.

I. Family and personal considerations

Family members. If the spouse or dependents of a working expa triate intend to work, they must apply independently for employ ment permits.

Driver’s permits. No time restriction applies to EEA nationals with respect to the use of their home-country driver’s licenses in Ireland while the licenses are valid. Non-EEA foreign nationals may drive legally in Ireland using their home-country driver’s licenses without restriction for 12 months. After the 12-month period expires, if the individual wishes to continue to drive in Ireland, he or she must apply for an Irish Learners Permit.

To obtain an Irish driver’s license, an individual must take writ ten, verbal, practical and vision tests.