Where you are engaged in the construction, forestry and meat processing industries then a withholding tax known as Relevant Contracts Tax (“RCT”) applies. This is an electronic system whereby the principal contractor notifies the Revenue Commissioners online, of all relevant contracts and in return is advised of the applicable rate.
The rate of Withholding Tax depends on your compliance record and history with the Revenue Commissioners.
There are three rates applicable – 0%, 20% and 35%.
Where “relevant operations” under a “relevant contract” are carried out in Ireland, then RCT will apply. It is important to note that RCT also applies to non-resident businesses. Where no other Irish taxes are due then a refund of RCT can be obtained on application to the Revenue Commissioners.
Gross status can be obtained if an application is made to the Revenue Commissioners. This can be a long and complicated application procedure and professional advice should be sought in this regard.
Professional Services Withholding Tax
Irish Income Tax, at the standard rate, is deducted from payments made for Professional Services by Government Departments, state Bodies, Local Authorities etc. This is known as Professional Services Withholding Tax (“PSWT”).
Services considered as Professional Services are medical, dental, veterinary, architectural, engineering, accountancy, consultancy, legal etc.
Non-resident businesses supplying “Professional Services” to Government Departments etc. will be liable to PSWT. If no other Irish taxes (i.e. Income Tax or Corporation Tax) are due, then a refund of PSWT can be obtained on application to the Revenue Commissioners.