Are you moving to Ireland or within Ireland to take up a contract role? Did you know that you may be entitled to tax relief on some of the costs associated with your relocation?
Here’s my Top Tips on using tax relief to reduce some of the costs for contractors when relocating!
Due to the nature of contracting, relocating to take up contract roles is quite often necessary for some individuals. Whether it be moving to Ireland from abroad or relocating within Ireland, significant expenses will be incurred making the move. The good news is that tax relief is available to reduce the cost associated with your move.
What kind of Relocation Expenses are eligible for tax relief?
The following expenses can be reimbursed through your Umbrella Company or own Private Limited Company tax-free:
1. First 3 months’ rent
Your first 3 months rent costs can be claimed. This can reduce the cost of your rent by up to 50% for the first 3 months of the contract.
2. Temporary subsistence allowance
You can also claim temporary subsistence while looking for new accommodation, subject to a maximum of 10 nights at rate of €147 per night. For example; if you stay in a bed & breakfast and pay €70 per night; you can still claim the full €147 per night as a tax-free expense.
3. Travel costs
Any travel costs incurred by you moving to the contract location including travel costs for any family members making the journey with you. This includes flights, mileage, ferry, train costs etc.
4. Removal of furniture costs
For example; using a removal company to move your personal belongings to your new home.
5. Other costs associated with moving to a new house
such as auctioneer’s fees, solicitor’s fees and stamp duty, can also be claimed.
In general, if moving to a new house is required and the expenses are reasonable, they should be allowable for a tax deduction. Myself and the Fenero Team are here to give advice and clarification to contractors who are relocating, so don’t hesitate to drop us a line.
Are there any restrictions?
Yes, tax relief on Relocation Expenses is available only where there is a minimum distance of 100km between the old house and the new house.
For contractors travelling to Ireland for a contract role this distance will easily be satisfied.
Contractors travelling within Ireland need to make sure the distance from their current home to their new home is a minimum of 100km.
If you are considering relocating to take up a contract role, Fenero are here to help you with any questions you may have, including general advice regarding the full range of expenses you may be able to claim while contracting.
We have a particular area of expertise in advising individuals who are moving to Ireland to start contracting here. We can offer advice on obtaining a PPS number, opening a new bank account and Visa requirements.
If you are relocating from the UK and will be operating in Ireland using your UK limited company, you may find it useful to read our guide to Irish taxes for UK Limited Companies here: https://knowledge.fenero.ie/contracting-ireland-uk-limited-company-guide-irish-tax