Luck o' the Irish: They Get to Legally Avoid Taxes!
Unlike most other nations (including Canada, the United Kingdom and Ireland), the United States taxes all U.S. citizens and resident aliens, even if these persons choose to live outside United States.In stark contrast, Ireland chose the corporate low-tax route years ago. As a result, Ireland has become the prosperity powerhouse of Europe. Businesses and workers from all over Europe flocked to Ireland as new jobs expanded under business taxes ranging from 10% to a maximum of 25%, with a standard rate of 12.5% for most. Many Irish citizens who left in the dismal days of recession and depression have returned to Ireland for these new developments.Ireland taxing an individual's income is what liberal politicians like to call "progressive." The higher the income, the higher the rate of tax payable. In Ireland, the tax rates for an individual in 2007 were between 20% and 41%. But in order to be considered a resident for tax purposes, one of two tests must apply. You have to maintain residency of more than 183 days a year in Ireland or residency of more than 280 days over a period of two years.The latest figures from Ireland Revenue show that some few of 4.3 million Irishmen, including those of great wealth, have chosen to base themselves abroad. They choose to pay lower taxes in low-tax destinations across the globe. Although Ireland's tax rates are relatively low by global standards, an increasing number of high-net-worth individuals are deciding to leave the country of their birth and move to places with lower income tax and no capital gains taxes.New figures prepared by the Revenue Commissioners show there are 19 high net worth individuals who are Irish domiciled, but who are legally non-residents for tax purposes. The figures includes individuals whose net worth (assets less liabilities) exceeds €50 million (US$72.3 million). There are estimated to be more than 250 people on the high net worth list.Nineteen out of 250 people isn't many but it includes most of Ireland's extra-super wealthy. Of the top 20 individuals on the Irish Rich List, at least half are tax residents outside Ireland. Ireland now has more than 3,000 tax exiles who claim non-residency. Many of these individuals are not in the top 250, but they do have serious wealth.Irish Revenue routinely visits the Irish homes of tax exiles to check if they are in the jurisdiction. They also monitor flights by private jets into Dublin and Shannon to ensure that records are correct. Tax exiles must keep flight logs and a detailed diary of their location 365 days of the year. A 2002 law states that an Irish person has to be a non-resident for five years before they can escape paying capital gains tax on the sale of a company or an asset. A person must now be a non-resident for three successive years before they can be regarded as a non-taxable citizen for the purposes of income tax.Most Irish tax exiles live in tax havens such as Switzerland, Monaco, Liechtenstein, Bermuda, the Cayman Islands, the British Virgin Islands and Andorra.
Unlike most other nations (including Canada, the United Kingdom and Ireland), the United States taxes all U.S. citizens and resident aliens, even if these persons choose to live outside United States.In stark contrast, Ireland chose the corporate low-tax route years ago. As a result, Ireland has become the prosperity powerhouse of Europe. Businesses and workers from all over Europe flocked to Ireland as new jobs expanded under business taxes ranging from 10% to a maximum of 25%, with a standard rate of 12.5% for most. Many Irish citizens who left in the dismal days of recession and depression have returned to Ireland for these new developments.Ireland taxing an individual's income is what liberal politicians like to call "progressive." The higher the income, the higher the rate of tax payable. In Ireland, the tax rates for an individual in 2007 were between 20% and 41%. But in order to be considered a resident for tax purposes, one of two tests must apply. You have to maintain residency of more than 183 days a year in Ireland or residency of more than 280 days over a period of two years.The latest figures from Ireland Revenue show that some few of 4.3 million Irishmen, including those of great wealth, have chosen to base themselves abroad. They choose to pay lower taxes in low-tax destinations across the globe. Although Ireland's tax rates are relatively low by global standards, an increasing number of high-net-worth individuals are deciding to leave the country of their birth and move to places with lower income tax and no capital gains taxes.New figures prepared by the Revenue Commissioners show there are 19 high net worth individuals who are Irish domiciled, but who are legally non-residents for tax purposes. The figures includes individuals whose net worth (assets less liabilities) exceeds €50 million (US$72.3 million). There are estimated to be more than 250 people on the high net worth list.Nineteen out of 250 people isn't many but it includes most of Ireland's extra-super wealthy. Of the top 20 individuals on the Irish Rich List, at least half are tax residents outside Ireland. Ireland now has more than 3,000 tax exiles who claim non-residency. Many of these individuals are not in the top 250, but they do have serious wealth.Irish Revenue routinely visits the Irish homes of tax exiles to check if they are in the jurisdiction. They also monitor flights by private jets into Dublin and Shannon to ensure that records are correct. Tax exiles must keep flight logs and a detailed diary of their location 365 days of the year. A 2002 law states that an Irish person has to be a non-resident for five years before they can escape paying capital gains tax on the sale of a company or an asset. A person must now be a non-resident for three successive years before they can be regarded as a non-taxable citizen for the purposes of income tax.Most Irish tax exiles live in tax havens such as Switzerland, Monaco, Liechtenstein, Bermuda, the Cayman Islands, the British Virgin Islands and Andorra.
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