Alan Dillon (Mayo, Fine Gael)
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183. To ask the Minister for Finance if consideration will be given to an issue (details supplied); and if he will provide an update on the matter. [29097/24]

Jack Chambers (Dublin West, Fianna Fail)
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I am advised by Revenue that under general charging rules in Ireland, the extent to which a taxpayer is liable to tax on his or her US-sourced income depends on his or her residence and domicile position for Irish tax purposes. An individual who is resident and domiciled for Irish tax purposes is liable to Irish income tax on their worldwide income. An individual who is resident, but not domiciled, for Irish tax purposes is liable to Irish income tax on Irish-sourced income, but a liability to tax will only arise on their foreign sourced income only to the extent that this income is remitted to the State. This is known as the remittance basis of taxation.

Further information regarding the above is available at the following link: www.revenue.ie/en/jobs-and-pensions/tax-residence/index.aspx.

Therefore, the extent to which the payments are chargeable to Irish income tax depends on the residence and domicile position of the taxpayer. The taxpayer may, however, be able to claim relief from double taxation under the Ireland-US Double Taxation Treaty (DTT) in respect of income that has been subject to tax in both jurisdictions.

I am further advised by Revenue that section 200 of the Taxes Consolidation Act (TCA) 1997 provides for a tax exemption for certain foreign pensions which are paid to Irish resident taxpayers. Where these pensions are disregarded for income tax purposes in the hands of a resident of the country of source (in this case the USA), they are also disregarded for income tax purposes in this State, provided the country of source has a similar income tax system to Ireland. This means that, in general, if a USA pension (for example an occupational pension) is not subject to tax in the USA, then it will not be subject to Irish Income Tax.

There is an exception to this general rule in relation to United States social security pensions, which are excluded from the scope of the section. The specific treatment of United States social security pensions is dealt with under Article 18(1)(b) of the Ireland-US DTT. The DTT provides that United States social security pensions paid to Irish residents are exempt from tax in the United States, but are subject to tax in Ireland. Revenue guidance material on section 200 is available in Tax and Duty Manual Part 07-01-09 Certain Foreign Pensions, which is available on Revenue’s website - www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-07/07-01-09.pdf.

Without further specifics, the foregoing is a general overview of the position based on the information provided.