Residence and Domicile

An individual who is resident and domiciled in Ireland is liable to Irish income tax on his/her worldwide income as it arises (earned in the case of Schedule E). This individual’s ordinary residence status does not impact on his/her exposure to Irish income tax.
A person is resident in Ireland for tax purposes if he/she is present in the State for -
  1. 183 days or more in that tax year or
  2. 280 days or more in that tax year plus the previous tax year taken together, with a minimum of 30 days in each year.
  3. An individual coming to Ireland who is not a resident but who can show that he/she intends to remain in Ireland and be resident in the following year, may elect to be treated as resident for the year of arrival.
Ordinary Residence
The concept of ordinary residence is a much broader concept than that of residence. The term broadly means the place where you are habitually resident i.e. in general, a person is ordinarily resident in the country in which he/she spends most of his/her time.
An individual becomes ordinarily resident in Ireland if they have been tax resident in Ireland for each of the three previous tax years.

Domicile
Under common law, every person must have a domicile. A person can only have one domicile at any particular time but cannot be without a domicile
There are three kinds of domicile:
  1. Domicile of origin
  2. Domicile of choice
  3. Domicile of dependence
Domicile of Origin
Each person acquires a domicile at birth which in most cases is that of his father. This original domicile is retained throughout your life unless you acquire a domicile of choice. It should be noted that you cannot simply abandon your domicile of origin, it can only be replaced by acquiring a domicile of choice.

Domicile of Choice
It is possible to displace a domicile of origin and have it replaced by a domicile of choice: however this is not an easy process.
In order to change domicile, an individual needs to show that he or she:
  1. is resident in the new country; and
  2. intends to reside there permanently or for an unlimited time.
The first condition doesn’t necessarily refer to tax residence. It is more the fact that the individual has established a physical presence in the country. We look at the “quality” of the residence also. For example, if the individual owns a house in the country, which they claim is their domicile of choice, this is more persuasive than if they only rent accommodation there on an ad hoc basis during visits to the country.
The second condition will not be satisfied if an individual only intends to reside in the new country for a fixed period of time or for a particular purpose. The individual must intend to reside in the new country permanently or for an unlimited time. If there is an intention to limit the time spent in a country or if a return to the original country is intended after the happening of an event (a contingency) then, as in the Bullock case, such intention must be clearly expressed and there must be a substantial possibility that it could happen.
Acquiring a domicile of choice requires “a final and deliberate intention”. In practice this means a severing of almost all connections with the country of origin and establishing a permanent relationship in the country of choice. Providing conclusive evidence of intention is generally the factor that gives rise to difficulties in court cases related to domicile.
If a domicile of choice cannot be established clearly, then the individual’s current domicile does not change.

Domicile of dependence
A child is incapable of acquiring an independent domicile until he or she reaches the age of 18. Until then, the child has a domicile of dependence that normally follows that of his or her father.
There are complications if the child’s parents change their domicile, if one parent dies or if the parents live apart:
  1. Until a child turns 18 years of age, their domicile of dependence will change if their father changes his domicile during that time.
  2. If the child is born outside marriage, the child takes the domicile of his or her mother.
  3. If the father dies, the minor child may have a new domicile dependent on the mother.
  4. Where a child’s domicile of dependence is based on the domicile of choice of his or her parent, that domicile will remain the child’s domicile after attaining the age of 18 years until he or she acquires a new domicile of choice of his or her own. If the parent reverts to their domicile of origin before the child reaches 18 then the child’s domicile changes to the domicile of origin of the parent.
  5. The domicile of a minor at any time when their father and mother are living apart shall be that of their mother if:
    • The minor then has their home with their mother and has no home with their father; or
    • The minor has at any time taken his mother’s domicile by virtue of the above and has not since has a home with their father.
  6. After the death of the mother, a minor retains the mother’s domicile where the parents had been living apart before the mother’s death.

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