Clarifying Cross-Border Taxation for a Remote Worker

An Irish individual had spent several years working in London for a UK company. However, due to the pandemic, the individual decided to relocate back to Ireland while continuing to work remotely for the UK employer. 

During this time, the individual sold a property in the UK and purchased a family home in Ireland. As the pandemic drew to a close, an agreement was reached with the employer to split the workweek, commuting to the UK for two days and working remotely in Ireland for the remaining three days.

A man sitting at a desk behind a computer being given a piece of paper with a difficult task to complete.
A man sitting at a desk behind a computer being given a piece of paper with a difficult task to complete.

Problem

  • The remote worker needed to not only navigate the complex cross-border taxation between Ireland and the UK but they also needed to ensure tax matters for the sale of their UK property were in order.
  • Additionally, because both Ireland and the UK had the right to tax the individual’s income, the worker’s employer was also confused about the tax implications.

Process

  • We facilitated three-way consultations involving our client, our firm, and our UK partner to address Irish and UK tax residency and discuss the tax treaty between the UK and Ireland.
  • We were also able to address the employer’s withholding requirements and ensure year-end compliance obligations in both countries.
A woman writing out a detailed list of procedures on a piece of paper.
A contemplative, worry-free man sitting on a mountain side looking at mountains with a blue sky back drop.
A contemplative, worry-free man sitting on a mountain side looking at mountains with a blue sky back drop.

Outcome

  • With our expertise, our client was able to ensure that the impact on their take-home pay was optimised in their favour (as much as possible!) and that the stress associated with tax uncertainty was relieved for both them and their employer.
  • We were also able to provide clarity on tax obligations associated with their property purchase and examined social insurance obligations to ensure compliance in the appropriate jurisdiction.

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