UK/ Irish Ltd companies

[DrFuzz]

Good Morning all, first time poster, but have watched the forum for years.

I have a question though which i have not found the answer to elsewhere.

I am potentially starting a new contract in Ireland in the new year. The client are insisting on an irish Ltd company, which is fine. However after looking into the tax situation it will be difficult from what i have read to reduce the tax paid personally as there are no dividends etc.

So my question is, would this route be legal......

I set up an Irish Ltd company, or my partner does. The funds are paid into this account for the work done. Expenses are paid through this account etc. Then my UK litd company invoices for my time as if i have been sub-contracted to the irish one and i can be paid personally for my time and be paid a dividend etc.

I can't see how it could be illegal, more work maybe as two sets of books etc but its just one entity to another. Essentially Irish Ltd company will probably not make a profit even though the CT is cheaper there.

Any advice would be much appreciated.

[stek]

Good Morning all, first time poster, but have watched the forum for years.

I have a question though which i have not found the answer to elsewhere.

I am potentially starting a new contract in Ireland in the new year. The client are insisting on an irish Ltd company, which is fine. However after looking into the tax situation it will be difficult from what i have read to reduce the tax paid personally as there are no dividends etc.

So my question is, would this route be legal......

I set up an Irish Ltd company, or my partner does. The funds are paid into this account for the work done. Expenses are paid through this account etc. Then my UK litd company invoices for my time as if i have been sub-contracted to the irish one and i can be paid personally for my time and be paid a dividend etc.

I can't see how it could be illegal, more work maybe as two sets of books etc but its just one entity to another. Essentially Irish Ltd company will probably not make a profit even though the CT is cheaper there.

Any advice would be much appreciated.

You obviously haven't searched.

Go Director Umbrella, forget Irish Ltd, forget dodgy schemes, pay tax. PRSI and USC and gain peace of mind. Pay your 1800 euro car tax, 60 euro for GP, 16c per contactless debit card transaction, and 70c for a bag for 10 minutes life from Irish supermarket chain SuperNotValu....

[northernladyuk]

Good Morning all, first time poster, but have watched the forum for years.

I have a question though which i have not found the answer to elsewhere.

I am potentially starting a new contract in Ireland in the new year. The client are insisting on an irish Ltd company, which is fine. However after looking into the tax situation it will be difficult from what i have read to reduce the tax paid personally as there are no dividends etc.

So my question is, would this route be legal......

I set up an Irish Ltd company, or my partner does. The funds are paid into this account for the work done. Expenses are paid through this account etc. Then my UK litd company invoices for my time as if i have been sub-contracted to the irish one and i can be paid personally for my time and be paid a dividend etc.

I can't see how it could be illegal, more work maybe as two sets of books etc but its just one entity to another. Essentially Irish Ltd company will probably not make a profit even though the CT is cheaper there.

Any advice would be much appreciated.

If you are physically working in Ireland, you should pay tax in Ireland. As stek says, use a Director's Umbrella. Talk to Icon Accounting.

[DrFuzz]

If you are physically working in Ireland, you should pay tax in Ireland. As stek says, use a Director's Umbrella. Talk to Icon Accounting.

The issue is i will be working there for one of my contracts, not all, so i'd fly in for 3-4 days and go home to the UK and carry out work for a another non irish client through my UK Ltd co. This s the reason why i want to be paid through one company and invoice my time for the irish Ltd co. The only reason i am setting up the Irish Ltd co is because the client wants me to. It probably wont even be 6 months work but they are insisting on it.

[northernladyuk]

The issue is i will be working there for one of my contracts, not all, so i'd fly in for 3-4 days and go home to the UK and carry out work for a another non irish client through my UK Ltd co. This s the reason why i want to be paid through one company and invoice my time for the irish Ltd co. The only reason i am setting up the Irish Ltd co is because the client wants me to. It probably wont even be 6 months work but they are insisting on it.

If it's 6 months, 3 to 4 days per week, then set up and pay salary in Ireland via an Irish Director's Umbrella and use your full year's Irish tax allowance over about 90 days billed work.

I think you need proper advice for this. Sue from IPAYE seems to know what she's talking about and posts here quite often.

[rover and out]

Count the days

If it's 6 months, 3 to 4 days per week, then set up and pay salary in Ireland via an Irish Director's Umbrella and use your full year's Irish tax allowance over about 90 days billed work.

.

If it's only for six months don't forget that there is no personal Irish tax liability if you are not physically present in Ireland for more than 183 days.

[northernladyuk]

If it's only for six months don't forget that there is no personal Irish tax liability if you are not physically present in Ireland for more than 183 days.

Are you sure that is true?

[rover and out]

Yes, quite sure

Are you sure that is true?

Absolutely, I have managed to get a whole 13 months contracting in without taxation in the past.

It just depends how lucky you are with the contract start and are prepared to take a bit of holiday out of Ireland and spend a lot of weekends out of the country.

Your "attendance" allowance is 183 days in year 1. You are allowed 280 days total in year 1+2 ( then ongoing 280 in 2+3, 3+4 ). If you go there before April in year 1 I don't think it is possible. Around April or later it gets possible but pretty tight. The later in the year that you go, the more leeway you have in year 2. If you can do a bit of "work from home", it is easily achievable ( probably for a number of years).

Can't remember if attendance if based on being there at midnight or on any attendance absolutely ( think that it was midnight).

This was situation in 2007 and 2014. Haven't heard of any changes since. I used these rules to operate through my UK limited as I was not planning to stay beyond the 12 month contract.

This information was accepted by both of my agents when I worked there and is confirmed by articles on the Net and not contradicted by anything on the Irish Tax site.

Of course these days some agents are insisting on Irish Ltds or umbrellas for their own convenience or protection.

If you work through a Irish Ltd or umbrella, any tax put aside really should be put on deposit until the 183 day attendance limit has been passed, and returned to you if it is not.

And none of this applies to the tax situation of the intermediary that you are working through. I don't have any experience there so can't comment.

[Sue B]

Good Morning all, first time poster, but have watched the forum for years.

I have a question though which i have not found the answer to elsewhere.

I am potentially starting a new contract in Ireland in the new year. The client are insisting on an irish Ltd company, which is fine. However after looking into the tax situation it will be difficult from what i have read to reduce the tax paid personally as there are no dividends etc.

So my question is, would this route be legal......

I set up an Irish Ltd company, or my partner does. The funds are paid into this account for the work done. Expenses are paid through this account etc. Then my UK litd company invoices for my time as if i have been sub-contracted to the irish one and i can be paid personally for my time and be paid a dividend etc.

I can't see how it could be illegal, more work maybe as two sets of books etc but its just one entity to another. Essentially Irish Ltd company will probably not make a profit even though the CT is cheaper there.

Any advice would be much appreciated.

Just don't risk it. Nothing about this sounds right and its likely that the Irish Authorities will have an issue with it. Profits/Income that was derived by an Irish Limited Company by its employee providing his services in Ireland is taxable in Ireland. They will not be happy that this is billed back to a UK Ltd, with no Irish Corporation, Dividend or income tax paid. What about PRSI?

This is basically transfer pricing and if i were you i would take specialist legal advice in Ireland.

Whilst its easy to think up ways to avoid paying tax, the chances are whatever you had thought of, has already been thought of, and legislated against.

[TheCyclingProgrammer]

If it's only for six months don't forget that there is no personal Irish tax liability if you are not physically present in Ireland for more than 183 days.

I’m pretty sure the 183 day rule, so often misunderstood on here, is only relevant to determining if you're tax resident, not if you are liable to Irish tax.