Print this page

Commencing as an employer in Ireland - key points

We often receive queries from foreign companies seeking to locate one or two employees in Ireland, this may be to operate as sales representatives or carry out long term projects with clients etc . This article briefly identifies the key legal and revenue implications of such an exercise for the employer.

If a foreign company intends to locate employees within the State, the company must register with the Revenue Commissioners as an employer. This is a straightforward process, however, it does require the provision of an address within the State to which post must be forwarded. Deduction of Irish taxes shall have to be made to the gross salary payment to the employee. Employers are primarily obligated to carry this out and it is generally not tax-compliant to require the employee to address tax related issues. Typically the foreign company will have to operate a payroll function in relation to that employee. There are firms of accountants and payroll service providers who offer such a service to foreign based companies.

The general position of the Revenue Commissioners is that income derived from any trade profession or employment exercised in the State is taxable in the tax year in which it is earned. It may be that the employee will not be obligated to pay income tax on Irish earnings in his home country if Ireland has a double taxation treaty with the home country. In relation to employees of foreign companies who do not attain tax residency in the year of employment in Ireland - they may apply for a tax rebate at the end of the tax year.

From a legal perspective, relocating an employee to Ireland to carry out employment duties here means that Irish employment statutes will apply to the employment relationship. If there is a conflict as between provisions in the contract of employment and the Irish statutory provisions - the statutory provisions will apply. For foreign companies within the EU, this may not pose a challenge, however, for organisations based outside the EU it may create some challenges. There may be variances between Ireland and other EU countries in relation to matters such as dismissal and the extent of awards to which employees are entitled if their employment rights are breached.

It is recommended that foreign companies who propose to relocate employees to Ireland obtain guidance on tax issues and have all employment documentation reviewed for compliance with Irish law.

Seeking Employment Law Litigation Advice

For further information and advice regarding your legal rights and entitlements, please contact Malcomson Law by calling 01 8744422 or complete an Online Enquiry Form. Your enquiry will be forwarded to a Solicitor who specialises in Employment Law.

This news section contains stories of interest from publicly available news sources. Where we are representing the clients referred to in the news material we will say so. Where we do not represent individuals or bodies mentioned or quoted, the inclusion of the news story in our news section is not intended nor should it be taken to imply that we act for the individual or body concerned.