Citizens of Ireland who are deciding to move abroad and live in another country should be aware of their upcoming tax situation. When you decide to leave Ireland, you are still considered an Irish resident and you will have to pay taxes on your income and gains. It is only after you have been out of Ireland for more than one tax year that you become exempt. Due to the fact that Ireland taxes income from other countries for the first year, you may be concerned about your income being taxed by two countries. To alleviate the harm of your income being taxed twice for an entire year, Ireland has double taxation agreement with many countries. Some of the countries Ireland has a double taxation agreement with are:
- South Africa
- United Kingdom
- United States of America
- + 60 other countries that can be found here: https://www.companyformations.ie/blog/irelands-extensive-list-of-double-taxation-treaties-with-71-countries/
While you are not taxed twice in these seventy-four countries that Ireland has established a double taxation agreement, your Irish income is still liable to Irish taxation. Therefore, while abroad, if you are making income from an Irish source, you are liable to Irish taxation. However, if you are making income abroad in the United States, for example, Ireland will not tax that income as you will be subject to the United States’ income tax. It is important to know your tax situation if you are planning to move abroad. Prior to leaving, you want to make sure you have an in depth knowledge of the taxation of the country you are moving to and your tax liability back in Ireland in order to ensure you are not losing money you could be spending, saving or investing for your future.