Income tax in Ireland
October 23, 2018
INDIVIDUAL TAXATION
Residents in Ireland are taxed on their worldwide income. Foreign individuals become residents if they are present in Ireland for more than 183 days in a year. Married couples may elect to be taxed jointly or separately.
The tax year in Ireland had been aligned to the calendar year as of January 2002.
INCOME TAX
Residents are taxed on all types of income. Income is classified into different categories according to their income source.
Taxable income is generally an aggregate of all types of income. Deductions, allowances and credits may be applied before income tax is imposed. Different rates apply for single individuals and married persons.
INCOME TAX 2018 FOR SINGLE/WIDOWED INDIVIDUALS |
|
| TAXABLE INCOME, € | TAX RATE |
| Up to €34,550 | 20% |
| Over €34,550 | 40% on all income over €34,550 |
| Source: Global Property Guide | |
INCOME TAX 2018 FOR SINGLE/WIDOWED INDIVIDUALS WITH DEPENDENT CHILDREN |
|
| TAXABLE INCOME, € | TAX RATE |
| Up to €38,550 | 20% |
| Over €38,550 | 40% on all income over €38,550 |
| Source: Global Property Guide | |
INCOME TAX 2018 FOR MARRIED PERSONS, SPOUSE WITHOUT INCOME |
|
| TAXABLE INCOME, € | TAX RATE |
| Up to €43,550 | 20% |
| Over €43,550 | 40% on all income over €43,550 |
| Source: Global Property Guide | |
INCOME TAX 2018 FOR MARRIED PERSONS, SPOUSE WITH INCOME |
|
| TAXABLE INCOME, € | TAX RATE |
| Up to €69,100 | 20% |
| Over €69,100 | 40% on all income over €69,100 |
| Source: Global Property Guide | |
INCOME TAX 2017 FOR SINGLE/WIDOWED INDIVIDUALS |
|
| TAXABLE INCOME, € | TAX RATE |
| Up to €33,800 | 20% |
| Over €33,800 | 40% on all income over €33,800 |
| Source: Global Property Guide | |
INCOME TAX 2017 FOR SINGLE/WIDOWED INDIVIDUALS WITH DEPENDENT CHILDREN |
|
| TAXABLE INCOME, € | TAX RATE |
| Up to €37,800 | 20% |
| Over €37,800 | 40% on all income over €37,800 |
| Source: Global Property Guide | |
INCOME TAX 2017 FOR MARRIED PERSONS, SPOUSE WITHOUT INCOME |
|
| TAXABLE INCOME, € | TAX RATE |
| Up to €42,800 | 20% |
| Over €42,800 | 40% on all income over €42,800 |
| Source: Global Property Guide | |
INCOME TAX 2017 FOR MARRIED PERSONS, SPOUSE WITH INCOME |
|
| TAXABLE INCOME, € | TAX RATE |
| Up to €67,600 | 20% |
| Over €67,600 | 40% on all income over €67,600 |
| Source: Global Property Guide | |
Residents are entitled to numerous tax credits and deductions.
The income tax exemption limits for 2018 are as follows:
- €18,000 for single, widowed, or surviving civil partner
- €36,000 for married or in a civil partnership
The income tax exemption limits for 2017 are as follows:
- €18,000 for single, widowed, or surviving civil partner
- €36,000 for married or in a civil partnership
The Irish Tax & Customs have more details on tax credits and deductions available to residents.
RENTAL INCOME
Rental income is taxed at the standard income tax rates. Taxable income is calculated as gross rent less income-generating expenses. Allowable deductions include ground rent, rates, maintenance costs, general repairs, insurance, management fees, service charges, advertising, accounting fees, depreciation (wear and tear), building expenditures, and interest.
Stamp Duty on Property Leases
Stamp duty rates on property leases range from 1% to 12%, which is levied on the average annual rent reserved by lease. The applicable rate depends on the length of the lease.
STAMP DUTY ON PROPERTY LEASE |
|
| LEASE PERIOD | |
| Up to 35 years or indefinite | 1% of average annual rent |
| 36 years to 100 years | 6% of average annual rent |
| Over 100 years | 12% of average annual rent |
| Source: Global Property Guide | |
Stamp duty rates range from 0% to 6% on premiums on leases of land and other real property.
CAPITAL GAINS
Capital gains tax is imposed at a flat rate of 33%. Taxable capital gains are generally computed as selling price less acquisition costs, adjusted for inflation, and improvement costs. The first €1,270 of capital gains is exempt from taxation.
Gains from the disposal of a taxpayer´s primary residence are also exempt.
Stamp Duty on Sales of Residential Properties
Stamp duties are levied on sales of residential properties. The rates range from 0% to 9%, the applicable rates depend on the property value, property size, and the status of the property buyer.
STAMP DUTY ON SALES OF RESIDENTIAL PROPERTIES |
|
| TAX BASE, € | |
| Up to €1,000,000 | |
| Over €1,000,000 | |
| Source: Global Property Guide | |
PROPERTY TAXATION
Local Property Tax (LPT)
Local property tax is levied at different rates, depending on the value of the property.
For properties that are valued at least €1,000,000, local property tax is levied at a flat rate of 0.18% on the first €1,000,000, and at a flat rate of 0.25% on the property value exceeding €1,000,000.
LOCAL PROPERTY TAX FOR PROPERTIES WORTH AT LEAST €1,000,000 |
|
| PEROPERTY VALUE , € | |
| Up to €1,000,000 | |
| Over €1,000,000 | |
| Source: Global Property Guide | |
For properties that are valued €50,000 up to €1,000,000, a different local property tax rate system applies.
CORPORATE TAXATION
INCOME TAX
Income earned by companies is subject to corporate income tax at varying rates depending on income classification: 12.5% on trading income and 25% on non-trading income.
CAPITAL GAINS TAX
Capital gains tax earned by companies is subject to capital gains tax at 33%.