Dominic Coyle answers a selection of your questions.
My wife and I are planning on buying a home in Armagh. My plan is to commute daily to my job in Dublin. Will this have any impact on my tax status?
Mr MV, Dublin
It certainly will. There is specific provision made in the Double Taxation Agreement between Ireland and Britain for cases such as yours. The relevant section, I am told by the Revenue Commissioners, is Article 15, which relates to people living in the North but working in the Republic in the private sector. There is a separate section with somewhat different regulations for those who are in "governmental employment".
As with all these agreements, the language in which the terms are framed is very legalistic. However, the Revenue has helpfully summarised its provisions.
Paragraph 1 says that earnings by a Northern Ireland resident are taxable in the UK, except where you work in the Republic. In such cases, both jurisdictions have the right to levy tax.
The next paragraph of Article 15 outlines the limited circumstances where the tax authorities in Northern Ireland can claim sole rights to tax someone working south of the border.
These are:
a) where you work in the Republic for fewer than 184 days in a tax year;
b) where your employer is not resident in the Republic and;
c) where your pay is not accounted for by your employer's Irish operation.
It would appear that you breach at least one and possibly all of these conditions, so the UK authorities cannot tell the Revenue that they have sole taxing rights.
Given that two jurisdictions have rights to your tax, it comes down then to whose rights are primary and the simple rule here is that the country in which you are resident has the primary tax rights - Northern Ireland under the scenario you outline. So, should you make this move, the UK Inland Revenue would tax your worldwide income, according to its rates and allowances - and would give credit for any Irish tax you paid at source.
And you are likely to pay tax at source in the Republic. Assuming you are working as an employee, your income down here will be taxed as usual under the PAYE rules.
Rent relief
I have a house rented in the country which I am using frequently. Can I claim the rent against my taxable income?
How will this affect my principal private residence if, for example, I wanted to sell my other house?
Mr NL, Dublin
As far as I can see, there is no way you can claim rent on this property you are renting.
My understanding from your letter is that you have, in Dublin, a property which you use as your principal private residence - or home. You also have this other property that you rent from someone else for unspecified purposes, although it seems to be more than a holiday home.
My understanding is that the only claim a person can make in respect of rent is rent relief on private rented accommodation. However, this is quite constrained and is clearly designed to provide some benefit to people who are full-time tenants.
From your point of view, the most significant condition is the following: "The rent paid must be in respect of private rented accommodation, used as a sole or main residence.This includes rents paid for bedsitters, flat, apartments or houses." What it does not include is premises used on an occasional basis - even frequently.
Your reference to your "other house" is somewhat confusing. If you are renting the house down the country, then you own only one house. In that situation, it is your principal private residence. As such, it attracts no capital gains tax if and when you sell it.
The fact that you are renting another property for some of the time has no impact on your principle private residence.
Stamp duty
I think it is incorrect to say, as you did in a recent column, that a transfer of a house from parents to child has no stamp duty implications. Stamp duty is chargeable at one half of the rate for residential properties determined by the market value of the property.
Ms JM, e-mail
You are quite correct. The issue arose in connection with elderly parents looking to transfer a property to a child and avoid inheritance tax.
I said stamp duty would not apply but, as you say, that is not the case. Stamp duty on the market value of the property would be levied at half the relevant rate.
Please send your queries to Dominic Coyle, Q&A, The Irish Times, D'Olier Street, Dublin 2 or e-mail to dcoyle@irish-times.ie. This column is a reader service and is not intended to replace professional advice. Due to the volume of mail, there may be a delay in answering queries.
