Q: I have lived in Spain since January 2017 where I work as a self-employed teacher. However, I worked in Ireland for some weeks during 2017, earning around €2,000 (PAYE income only). The same will happen this year. What are the tax implications of the few weeks’ Irish work? I am assuming I don’t need to declare either Spanish income in Ireland or Irish income in Spain? I am a little confused and I don’t want to be double-taxed. Fergal, Barcelona, Spain
A: In drafting our reply, we assume that you do not have any income other than the Irish and Spanish income set out in your question. Based on the information provided, we are unable to determine your tax residency status.
Your Irish PAYE income is taxable in Ireland as you perform your duties here.
The extent of your liability to Irish income tax on your Spanish income will depend on whether you are tax resident here. You are Irish tax resident for a tax year if you are in Ireland for 183 days or more in any year of assessment, or for 280 days or more in the year of assessment and the preceding year.
If you spend 30 days or less in Ireland for any tax year, you cannot be Irish tax resident for that year. If you are in Ireland at any time during a day, that day is counted in determining your Irish tax residence.
If you are not Irish tax resident in 2017 and 2018, there is no need for you to submit an Irish tax return. But as set out above, you will continue to pay Irish tax at source on your Irish PAYE income. Spanish income tax might also arise on your Irish PAYE income, potentially giving rise to tax liabilities in Ireland and Spain on the same income.
If you are tax resident in Ireland in 2017 and 2018, you will pay Irish taxes on your worldwide income. You will be required to register for income tax with the Revenue Commissioners and file a Form 11 return declaring your Irish and Spanish income. Depending on your tax residency status in Spain, you may also be liable to Spanish tax again – raising the possibility of double taxation.
However, the Double Taxation Agreement between Ireland and Spain should mean that your income is not doubly taxed. This is generally provided for by crediting any foreign tax paid against any liability in your country of tax residence as determined under the treaty, or in certain circumstances exempting that income from tax in either Ireland or Spain.
You should get advice in Spain to ensure that you comply with your Spanish tax obligations.
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