This article incorporates the provisions of the Finance Acts 2001 in Ireland and the UK,
both applicable from 6 April 2001. Other economic data is current as at
May 2001.In Ireland tax free allowances have been replaced from 6 April 2001 by a full tax
credit system. For comparability to the UK system tax credits are stated as tax free
allowances.
The Irish tax year has been changed to a calendar year basis from the period 6 April
to 31 December 2001.
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Your first concern will be whether there is a market in Ireland for your
skills and experience. Professionals seeking work need to research the
availability of specific industry sectors relevant to their experience.
Currently there are many positions available at various levels in all
sectors -- with the technology, construction, tourism and services sectors
having the highest demand.
There are many advantages to living and working in Ireland. It is a small
country easy to navigate, with less of a social structure than the UK,
unemployment is low, there is strong demand for staff across all business
sectors and career prospects are good with major international companies
here. If you are looking to invest in your own business the lack of a
bureaucratic structure, as in the UK, will bring fruition to your task
much sooner. Further, in Ireland there is currently no similar legislation
to the IR35 rules in the UK which apply
from 6 April 2000 to contractors working through their own service companies.
According to Fergus Moore of Computer
Placement Limited, one of Ireland's specialist technology recruitment
agencies, "The demand in the technology sector is such that the contractor
or employee candidate has increasing strength to negotiate the terms and
conditions of their engagement. This has made employment within the Irish
technology sector an increasingly attractive proposition to non-Irish
resident candidates, and in recent months our consultants have only been
placing non-Irish resident candidates. Due to a continuing presence in
Ireland of the largest software companies in the world there continues
to be a significant strain on the labour force, which will increasingly
be filled by relocation of non-Irish resident technology professionals".
In Cork the market is not as established as Dublin but Diane Baker, Manager
of C.P.L's Cork office sees Ireland's second city catching up. "The technology
market in Cork is relatively new, though we see the demand for contractors
over the next 12 months increasing rapidly due to the lack of availability
of skilled professionals. There is a good range of positions available
for software developers with a minimum of 2 years experience".
Bryan Hyland of Premier
Group Recruitment says, "the market in Cork has levelled out recently
reflecting the increasing choice of positions available in other parts
of Ireland - rather than a fall in placements - and the throughput of
people has increased throughout our four offices". Premier is Munster's
largest recruitment agency with offices in Cork, Limerick, Waterford and
Kilkenny. Hyland adds, "People coming to Ireland from the UK need to be
particularly conscious of the transferability of their skills".
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The Income Tax rates in Ireland are comparable to the UK in that Ireland
has a standard rate of 20% and a higher rate of 42% (versus a lower rate
of 10%, standard of 22% and higher rate of 40% in the UK).
There is a tax-free allowance of IR£ 5,500 for a single person. This
is doubled to IR£ 11,000 for either a single income married couple or
a joint income couple -- much more generous than the UK's personal allowance
of STG£ 4,535 provided you are a married couple with a single income.
This is because the single persons allowance of STG£ 4,535 in the UK is
available only on an individual basis. If you are either a single person
or a joint income couple then you are still better off. If either or both
of you also work as employees under PAYE a further allowance of IR£ 2000
each is also available.
The tax bands in Ireland have widened considerably in recent years and
the higher rate of 42% begins on income over IR£ 20,000 gross per annum
for a single person or IR£ 40,000 for a married couple, assuming the lower
income spouse is earning at least IR£ 11,000. This may turn out to be the
biggest culture shock you will experience when you arrive in Ireland.
Though, as you will discover when you read on, the effect on your take
home pay is not as severe as you may think, particularly if you are a
married couple with a single income. Also there are many things to compensate
for this. The current Irish government gave a strong indication in November
1999 that in forthcoming budgets the tax bands would be widened and they
have kept to their word. The gap in bands between Ireland and the UK should
continue to narrow during the coming years.
See the appendices for comparisons of tax
and insurance deductions due in Ireland and in the UK for the following:
- Appendix 1 for a single person earning
IR/STG£ 40,000 per annum
- Appendix 1A for a couple both earning
IR/STG£ 40,000 per annum
- Appendix 1B for a married couple with
a single income of IR/STG£ 40,000 per annum
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