Contracting in Ireland - Advice needed

[fdama]

Hi,

I'm quite new to contracting having just completed my first one which was a 6 month (3 month + extension) contract.

I have recently been contacted by a UK consultancy who had opportunities available with their client in Dublin. The contract term is of 3 months with strong possibilities of extensions and the day rate is quite good although the exact amount has not finalised, but I would have to fork out for hotels and airline tickets, of course. We had a chat and they would like me to join them as an associate. I was sent over an associate agreement to sign. I have yet to meet their client in Dublin for the interview.

From what I could gather, the associate agreement and Non Disclosure Agreement is a long document that covers the responsibilities and working practices of being an Associate with them, but I am a bit hesitant to sign it before I get some advice from experienced people on this forum. So, what should I really look out for before I potentially get myself in deep water?

The other question I have is with working in Ireland itself. My only contracting experience so far has been in the UK. I used an umbrella company as the contract was initially for 3 months but was extended. This contract opportunity that I am intending to pursue is also for 3 months initially so is an umbrella company the way to go? Would I fair financially the same comparatively if I was in the UK? Would the umbrella company be Ireland based? I would be grateful for any advice given. I took a look at the guides to contracting in Ireland in the 'Contracting Overseas' section but was not really helpful.

Thanks for your advice

[Jessica@WhiteFieldTax]

For a three month contract, a Umbrella is probably easiest and least hassle.

Anything longer, think about your own company, dependant on how you are with paperwork and your take on where you are IR35 wise.

Regarding Ireland, talk to your chosen umbrella(s) and see what they say. Maybe talk to some UK ones and some Eire ones and see how they compare.

If you went down your own company UK route, then you have to register with the Eire tax people, but can get an exemption on paying Eire taxes and social security for up to 183 days AFAIR. Over that you need to get into the local system.

[ShandyDrinker]

For a three month contract, a Umbrella is probably easiest and least hassle.

Anything longer, think about your own company, dependant on how you are with paperwork and your take on where you are IR35 wise.

Regarding Ireland, talk to your chosen umbrella(s) and see what they say. Maybe talk to some UK ones and some Eire ones and see how they compare.

If you went down your own company UK route, then you have to register with the Eire tax people, but can get an exemption on paying Eire taxes and social security for up to 183 days AFAIR. Over than that you need to get into the local system.

Pretty much the advice I've been given although I'd also add that in addition to the 183 days there is a 280 day "look back" rule covering 2 tax years. The devil is in the detail however. From what I can ascertain, a day is defined as any part of a day you are physically present in Ireland, which was changed a few years ago from the more advantageous being present in Ireland at midnight.

I would strongly recommend looking at retention rates with Irish Umbrellas and Irish Limited Companies before making any commitment.

[BlasterBates]

If you went down your own company UK route, then you have to register with the Eire tax people, but can get an exemption on paying Eire taxes and social security for up to 183 days AFAIR. Over than that you need to get into the local system.

This is an excellent piece of advice perhaps this should be repeated for all countries, ie.

register with the Eire tax people, but can get an exemption

i.e. don't do it in a clandestine fashion as many contractors hoping you'll get away with it, register and actively seek tax relief.

I declare my worldwide earnings on my Swiss tax form even though I'm not liable to pay tax on it, and then actively seek relief. This means I don't have to worry about a Swiss SWAT team barging into my flat to confiscate my bank statements.

[SueEllen]

From what I could gather, the associate agreement and Non Disclosure Agreement is a long document that covers the responsibilities and working practices of being an Associate with them, but I am a bit hesitant to sign it before I get some advice from experienced people on this forum. So, what should I really look out for before I potentially get myself in deep water?

Read the document and if you find things you don't understand get a solicitor who deals with commericial contracts to look at it.

Yes you have to pay but then it will ensure you won't find yourself stitched up later if things go wrong i.e. they try and find an excuse not to pay.

In regards to the tax advice you have been given useful info by the first 2 posters on this thread. You can also do a search for working in Ireland ignoring any advice that is more than 18 months old.

[lithium147]

Is it possible to setup company in ireland, while you are there, to utilise the 12.5% corporation tax.
Then when you come back to the UK, you can keep using this company for as long as you like?

[escapeUK]

Is it possible to setup company in ireland, while you are there, to utilise the 12.5% corporation tax.
Then when you come back to the UK, you can keep using this company for as long as you like?

This is something I have wondered. If big companies can set up head offices in countries with low tax regimes, why cant we?

[SueEllen]

Is it possible to setup company in ireland, while you are there, to utilise the 12.5% corporation tax.
Then when you come back to the UK, you can keep using this company for as long as you like?

1. Uk agencies will refuse to deal with you
2. HMRC will come after your company & you as a director as you are a UK resident

Unlike large companies you don't have staff in Eire to argue that your company has a presence there.

[borderreiver]

1. Uk agencies will refuse to deal with you
2. HMRC will come after your company & you as a director as you are a UK resident

Unlike large companies you don't have staff in Eire to argue that your company has a presence there.

Surely if you are located in Ireland for a contract (and can prove it) and are the sole director of your Ltd, then all revenue generated in Ireland would only be subject to Irish Corp. tax?

Income tax for you as a UK resident is another matter, of course.

[BlasterBates]

Surely if you are located in Ireland for a contract (and can prove it) and are the sole director of your Ltd, then all revenue generated in Ireland would only be subject to Irish Corp. tax?

Income tax for you as a UK resident is another matter, of course.

It doesn't work like that. Your revenue is not in Ireland it's in the UK. For you to move the profit to Ireland your Irish company has to charge your UK company for services provided. However if it's a bogus service that won't wash. In other words you not only have to be located in Ireland you have to be doing something there, verifiably.

You see these multinationals actually do employee hundreds of people in their offshore company and the company actually provides a real service.

From what I see these companies operate legally.