I am assuming that the reference to “further measures announced in Budget 2012 with respect to the treatment of non-residents for tax purposes” refers to the amendment to the Domicile Levy legislation announced in Budget 2012 and implemented in section 136 Finance Act 2012. The Domicile Levy was introduced in Finance Act 2010 and was charged on an individual:
- who in any year is Irish domiciled and an Irish citizen,
- whose worldwide income for the year exceeds €1m,
- whose Irish located property in the year is greater than €5m, and
- whose liability to Irish income tax for the year is less than €200,000.
Where a relevant person has paid income tax that person is entitled to a credit for the tax paid in calculating the amount of the Domicile Levy.
The amendment introduced in section 136 Finance Act 2012 removed the requirement to be an Irish citizen. The effect of this amendment is that persons who meet the other criteria will be liable to the levy whether or not they are Irish citizens. The returns for the tax year 2012 will be the first returns affected by the amendment. These returns are due to be filed on or before 31 October 2013. I am informed by the Revenue Commissioners that no returns in relation to the Domicile Levy for the tax year 2012 have been filed to date. It is not possible at this point to determine how many persons this measure will affect for the tax year 2012.
The only year for which Domicile Levy returns have been filed is the tax year 2010. These returns were due on 31 October 2011. In all, 11 returns have been filed in relation to the Domicile Levy for 2010 and the tax paid was €1,667,011. The levy applies to both resident and non-resident individuals who meet the above criteria. Based on information available to Revenue, eight individuals who filed Domicile Levy returns for 2010 are not resident in Ireland for tax purposes. The number of persons who have filed income tax returns for 2010, the latest year for which figures are available, indicating that they are non-resident is 10,781. Many non-resident individuals who file Irish tax returns would have a foreign domicile and accordingly would not be liable for the Domicile Levy.
The Programme for Government update in March 2012 confirmed the commitment to undertake a consultation process on residence issues in 2012 to inform preparation for further changes in 2013. I launched a public consultation on tax residence rules in May this year, wherein I invited interested parties to make submissions on possible revisions to the current residence rules for the taxation of individuals. This consultation process has now concluded. A total of eight submissions have been received and these will be published in due course, as indicated when the consultation was announced. My officials are considering the submissions and will be advising me on possible further changes as part of the preparations for Budget 2013.
