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Tax – Frontier workers

As a frontier worker you must pay income tax in the country where you earn your income, but your ultimate tax responsibility is with the country where you live so you must submit an annual self-assessment each year.

If you live in one jurisdiction and work in another you may potentially have income tax liability both where you live and where you work.

In Northern Ireland the HM Revenue & Customs (HMRC) collects tax to pay for public services.

Income tax and National Insurance contributions (NICs) are chargeable on all income earned by individuals in the tax year (6 April to 5 April) subject to certain exceptions and exemptions. An employee’s tax is deducted by their employer, through the Pay As You Earn (PAYE) system. Self-employed individuals are responsible for paying their own tax through the Self Assessment system.

Frontier workers living south, working north

Will pay tax directly to HMRC
Will also be required to submit an annual Self Assessment return to the Irish Revenue Commissioner.
Will be eligible for Trans-Border Workers Relief (which often means a zero bill to pay)
Civil servants (e.g. teachers) may not need to submit an annual Self Assessment, unless they have another source of Irish income or if they are jointly taxed with a spouse. Contact your local tax office to confirm your situation. Local tax offices (Border, Midlands, West region)

In Ireland income tax and Pay Related Social Insurance (PRSI) is chargeable on all income earned by individuals in the tax year (Jan – Dec) subject to certain exceptions and exemptions. An employee’s tax is deducted by their employer, through the Pay As You Earn (PAYE) system. If you are self-employed, or have income where some or all of the tax cannot be collected under the PAYE scheme you will be responsible for paying your own tax and submitting annual Self-Assessment tax returns. Please note that Trans-border Workers Relief is not available for NI residents.

Frontier workers living north, working south

Will pay tax directly to the Irish Revenue Commissioner
Will also be required to submit an annual Self Assessment on foreign earnings to HMRC
Will be eligible for foreign tax credit relief (based on Irish tax and USC paid) due to the Double Taxation Agreement between the UK and Ireland
Should be wary of using Irish tax credits to reduce their Irish tax bill, as it could result in a higher top-up tax payment in NI
May have a balance of UK tax to pay

The Universal Social Charge will be treated as a tax paid for the purposes of Article 2 of the UK/IRL Double Taxation treaty.

Tax – Frontier workers

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