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Matheson Private Client Update: Destination Ireland - legal and tax issues

AUTHOR(S): Paraic Madigan, John Gill
PRACTICE AREA GROUP: Private Client
DATE: 15.05.2013

Introduction

As a relatively small nation, Ireland’s migratory and economic patterns can be quite easily documented. In practice, we note a number of consistent trends in client and intermediary enquiries received over the past 18 months.  One source of enquiries comes directly from those overseas advisors advising a group which could be described as “the returning Irish”. These are Irish-domiciled individuals who are tax resident in a different jurisdiction and are seeking to return home.

Separately, due to particular economic circumstances in Ireland, enhanced foreign purchasing power, social and other factors which make Ireland an attractive destination, we see an ever-increasing number of enquiries from non-Irish domiciled clients who are looking to take up residence in Ireland for the first time. Finally, we regularly receive enquiries from those non-resident asset purchasers who are targeting Irish residential and commercial property. 

Background

By way of background, there are two fundamental concepts referred to throughout this update - domicile and tax residence. Domicile is a legal construct which could be broadly summarised as a person’s natural home and requires residence in a jurisdiction with the intention to continuously reside there permanently.

An individual is tax resident in Ireland if they meet one of two statutory tests:-

  • They spend 183 or more days in Ireland in a tax year, which is a calendar year.
  • Have a combined presence of 280 days aggregating the number of days in that year with the previous tax year, subject to a minimum of 30 days in either tax year. 

The interaction of both of these factors will have a significant bearing on the tax position of individuals in this jurisdiction.

For more information on your legal and tax issues, click on the relevant link below:

The returning Irish

Non-domiciled individuals and their Irish tax position

Property acquisition by non-Irish resident persons

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