The following blog provides you with some information on how much tax I pay in Ireland as a freelancer moving from abroad. Working out taxes and social insurance is a rather complicated process as a freelancer as there are a number of variables. That said, there are some useful sites such as:
these Government sites are reputable and a great source of free information about the tax system in Ireland.
In summary, there are two main tax rates in Ireland and as of 2016 the rates are 20% and 40%, if you are single with no dependents you pay 20% tax on your income up to an annual threshold of 33,000e. The only problem with this is that the 33,000e is split evenly over 12 months, so if you earn above 2,816e per month you will be hitting the higher tax rate of 40%. You will also receive an annual tax credit, these vary depending on your individual circumstances such as dependents, married, widow etc.
On top of PAYE taxes you will also be paying social insurance in Ireland on your income. The rates of social insurance vary however they are capped at 12% most people depending on their income pay around 11% on top of the 20-40% PAYE taxes.
The good news for freelancers, is that you will have the ability to reduce these taxes and deductions by offsetting certain business expenses that are essential for you to work as a freelancer. There has been a lot of attention of recent with the types of business expenses you can offset as a freelancer so seek professional and qualified advice in relation to claiming business expenses.
More good news, when you are a freelancer relocating to Ireland you will also be able to offset your initial relocation expenses so it is advisable to start saving those receipts for submiting when you arrive in Ireland. That said, if you are planning on creating a new limited company it is advisable to get things set-up ASAP as you will not be able to claim any pre-trading business expenses.
Should you be interested in a personalised estimate to help work out your taxes feel free to click below:
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