What is SARP?
SARP provides Income Tax relief to employees that are assigned to work in Ireland from abroad by their relevant employer.
What is a relevant employer?
A relevant employer must be a company that is incorporated and tax resident in a country in which Ireland has a double taxation or a Tax Information Exchange agreement with.
How do you qualify?
You can claim SARP by meeting the following criteria;
- You arrive in Ireland between 2012 – 2020, at the request of your employer
- You worked for your employer for 6 months before arriving in Ireland
- Your employment in Ireland is for a minimum of 12 consecutive months
- You were not tax resident in Ireland for the preceding 5 tax years
- You remain a tax resident in Ireland for all years you claim SARP relief
- You earn a minimum basic salary of €75,000 per annum, excluding bonuses, commissions, etc
Calculating the relief
A proportion of your salary is disregarded for Income Tax, i.e for 2019, the proportion available is 30% of your income over €75,000 up to €1 million.
This would apply if you commenced employment in Ireland on or after 01st January 2019.
Example – Year 1 only
|Balance remaining over threshold||€25,000|
|Balance @ 30%||€7,500|
|Relief @ 40%||€3,000|
Therefore, Mary is due €3,000 tax refund.
You can also receive certain travel expenses and tuition costs tax free.
How do you apply?
Employers are required to complete a Form SARP 1A for each employee and submit to Revenue within 90 days of the employee arriving in Ireland.
A tax return must be completed by an employee for each year they claim the relief.