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Working in Ireland and confused about Taxes?

2016-11-14 07:00:00 +0000 by Kellie-Anne Molloy

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Fresh Faces, new challenges and finding a good lunch spot! All these things come to mind when looking to work abroad and start a new multilingual job. However it can really pay off to think about your taxes too. Taxback.com know a small bit of planning can make the transition go smoothly, avoid any overpayment of tax and in some cases, even lead to a tax refund. 

Here is some great advice to help you plan:

  • Starting a multilingual job for the first time

If you’re starting a job for the first time, you need to take a couple of steps to ensure you aren’t taxed on an emergency basis:

1.    Give your PPS (Personal and Public Service Number) to your employer so they can inform the tax office that you’re working.
2.    Apply for a tax credit certificate by completing Form 12A and sending it to your local tax office.

You should complete the steps above as quickly as possible so your employer and the tax office can get it sorted before your first paycheck! 

The tax office will send you a Certificate of Tax Credits and Cut-off Point, which you can then give to your employer. 

  • Split Year Relief

It is possible for an individual who is a resident in Ireland for the year of arrival to not be taxed on their income outside Ireland in the year before they arrived here in Ireland. This means you may be entitled to your full year of Tax Credits even though you only worked part of the tax year in Ireland. This could lead to a Tax Refund if you arrive in or leave Ireland during a Tax Year. This is called Split Year Relief.

  • PAYE Taxes: Overview

Employees in Ireland are usually taxed in the Pay As You Earn Tax (PAYE) tax system. How much you pay usually depends on what you earn and is charged on the basis of your gross income. When you start a new job, you need to make sure you give your employer a P45 so you don’t get taxed on an emergency basis.

  • PRSI (Pay Related Social Insurance)

Your employer will deduct PRSI which will be allocated to the social insurance fund. These payments may give you entitlements to benefits such as jobseekers benefit, illness benefit, state pension, etc.  

  • Universal Social Charge

You’ll pay this if your income is more than €12,012 per year (2016). 
In some cases, you may even have an overpayment of USC, which Taxback.com can check for when you apply for your PAYE tax refund.
 
How is your tax calculated?
Your employer applies PAYE and USC tax based on your employee tax credit certificate. If Revenue doesn’t have up-to-date information on your personal circumstances (marital status, dependents, etc.), you might get an incorrect allocation of tax bands and credits.

Your payslip explained: 

 

  • What happens if I overpay tax?

You can apply for a refund! You may be due tax back if:
•    Arrived in Ireland during a Tax Year
•    Plan to leave Ireland before the Tax Year ends
•    You changed employer during the Tax Year
•    You paid emergency tax
•    You went on maternity leave
•    You got married recently
•    Had medical/non-routine dental expenses
•    And more
 
If you think you’re due a refund, you can get an estimate using our online tax calculator. 


  • Simple tax facts

•    The tax year is January 1 to  Dec 31
•    Your P60 is the tax certificate and you can use it to get a refund
•    You can go back 4 years for a tax refund
•    Average Irish tax refund is €880
•    You can get a free refund estimate using our online tax calculator here

Still confused? 
Taxback.com can give you a free, no-obligation tax refund estimate from the last 4 years. Click here to get started or contact one of our experts at careertrotter@taxback.com



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