Returning to Ireland: How much tax will I pay?

After eight years of austerity, taxes are finally coming down

 

This article forms part of the Returning to Ireland guide by The Irish Times, with information on jobs, housing, health and education, and advice from Irish emigrants who’ve already moved home.

The good news when it comes to taxes is that they are on the way down. After eight or so years of austerity, Budget 2015 finally reversed the trend – or at least partly - when the government introduced some income cuts. This was followed by further cuts to the universal social charge in Budget 2016.

However, this is not to suggest that the burden on taxpayers has significantly eased. Taxes remain elevated, and a significant portion of your income will still go to the Exchequer.

For example, a single person earning €30,000, will take home €484 a week, or €2,096 a month. On an income of €50,000, a married couple with one spouse working will get to keep €759 a week, or €3,289 a month. You can calculate how much tax you will pay by using The Irish Times online calculator, irishtimes.com/business/budget-2016/calculator-2016.

If you intend working for yourself when you come home, you will be hit hard however. On incomes over €100,000the self employed pay an additional 3 per cent in USC on top of the 52 per cent paid by employees.  

And remember, income tax is just one levy on your salary. If you own a property, you'll have to pay property tax, levied at a rate of 0.18 per cent up to valuations of €1 million. The amount of tax is assessed based on valuation bands, so for example, tax on a property worth €210,000 will be €405 a year. To see the full valuation bands see revenue.ie/en/tax/lpt.

Finally, don't forget to claim any tax you may be due from the country in which you are working. You can typically either do this yourself, or hire the services of a third party to do it. Taxback.com for example, says that it gets an average refund of $904 from Canada; AU$2,600 from Australia; £963 from the UK; and $550 from New Zealand. Remember however that a fee applies for such a service, although you can typically get an estimate of your refund for free first. For example, it charges $60 for US federal tax returns and a further $30 for state returns.

This article forms part of the Returning to Ireland guide by The Irish Times, with information on jobs, housing, health and education, and advice from Irish emigrants who’ve already moved home.

Information is correct at the time of update on May 25th, 2016, but readers are advised to check official websites linked to in the guide for the most up-to-date information. 

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