COVID-19 Global mobility and employment tax update - Crowe Ireland

COVID-19: Global mobility and employment tax update

COVID-19 Global mobility and employment tax update - Crowe Ireland

The Irish Government has introduced a number of measures to assist employees and employers with difficulties arising due to COVID-19. Recent guidance issued by Revenue addresses changes to compliance with certain reporting and filing deadlines and the satisfaction of a number of other tax-related conditions. Many of these issues will arise due to the fact that employees are now working from home as they are unable to carry out their duties in their normal place of work, be that in Ireland or another country. 

Revenue recommends that in all instances where COVID-19 affects the applicability of Irish tax legislation on an employee or employer, records should be maintained outlining the circumstances and should be made available to Revenue on request.

Irish tax residency

An individual is regarded as tax resident in Ireland for a tax year if he/she is present in Ireland:

  • at any one time or several times in the year of assessment for a period which in total amounts to 183 days or more, or
  • at any one time or several times in the year of assessment and the preceding year for a period which amounts in total to 280 days or more over the relevant two-year period.

However, he/she will not be regarded as resident for any tax year in which he or she spends 30 days or less in Ireland. In determining days present in Ireland, an individual is deemed to be present if he/she is in the country at any time during that day.

Where an individual who normally lives or works outside of Ireland but is currently unable to do so due to travel restrictions, this may impact their residency position if they spend additional days in Ireland that were not anticipated. 

However, Revenue guidance states that where an individual is prevented from leaving Ireland on his/her day of departure due to extraordinary natural occurrences or an exceptional third party failure or action – none of which could reasonably have been foreseen and avoided – the individual will not be regarded as being present in Ireland for tax residence purposes for the day after the intended day of departure, provided the individual is unavoidably present in the State on that day due only to ‘force majeure’ circumstances.

Revenue have confirmed that where a departure from the State is prevented due to COVID-19, they consider this ‘force majeure’ and the above conditions apply.

Benefit-in-kind (BIK)

Holiday or flight expenses
Where an employer reimburses the cost of holiday or flight cancellations or covers the cost of assisting employees returning to Ireland, this may ordinarily give rise to a taxable benefit-in-kind. 

However, Revenue have confirmed that where an employee is integral to the business and was required by his or her employer to return to Ireland to deal with issues relating to the COVID-19 crisis, the costs incurred are reasonable, and the employee is not otherwise compensated (i.e. by way of an insurance policy claim or direct claim to the service provider), a BIK will not arise. 

Revenue have confirmed that this also includes costs relating to family members who were on holidays or due to go on holidays with the employee.

Employer provided equipment
Where individuals are required to work from home, their employer may provide them with equipment such as computers, printers, scanners, fax machines, or software to enable him or her to work from home. Where the provision of these items are primarily for business use, a BIK will not arise on the employee in respect of incidental use. 

The provision of a telephone line or broadband for business use where private use of the connection is incidental will also not give rise to a BIK. 

Additionally, other equipment such as office furniture will not attract a BIK charge where the equipment is provided primarily for business use.

Payment of taxi fares
Where an employer pays for a taxi to transport an employee to or from work due to health and safety concerns, BIK will not apply for the duration of the COVID-19 period only.


Revenue have recently updated their guidelines on e-working and the treatment of associated expenses for remote workers. The update clarifies that where the government recommends that employers allow employees to work from home to support national public health objectives, as in the case of COVID-19, the employer may pay the employee up to €3.20 per day to cover the additional costs of working from home. Read our update here.

Share schemes – filing obligations

The reporting of share schemes involving submission returns such as the RSS1, ESS1, and KEEP1 ordinarily must be made by 31 March each year. Revenue have confirmed that the filing deadline for all 2019 share scheme returns is being extended from 31 March 2020 to 30 June 2020.

Income tax returns

Where an employer operates a real-time tax credit through payroll for foreign tax paid on restricted stock units (RSUs) during 2019, the employer must report the details to Revenue and the employee must file their income tax return by 31 March 2020. 

However, Revenue have confirmed that as a result of COVID-19, the 31 March 2020 deadline for filing of income tax returns will be extended to the standard filing deadline of 31 October 2020. The employer notification to Revenue in relation to such cases should be made as soon as possible but no later than the extended income tax filing date where applicable.

Global mobility reliefs 

Special Assignee Relief Programme (SARP)
SARP relief allows for a PAYE (Pay As You Earn) exemption in respect of 30% of an assignee’s income in excess of €75,000, subject to certain other conditions. An individual who wishes to claim SARP relief, must make a SARP 1A application to Revenue within 90 days of their arrival to Ireland. This deadline has been strictly enforced by Revenue in recent years.

Revenue have confirmed that due to COVID-19, the 90-day employer filing obligation has been extended for a further 60 days. It is Revenue’s expectation that such an extension should provide sufficient time for employers to file the required return, but exceptional cases may be submitted to Revenue for consideration on a case-by-case basis.

Transborder Workers Relief
Where an Irish tax resident travels daily or weekly to work in another country and pays tax in that country they may be entitled to Transborder Workers Relief. However, due to COVID-19 employees may no longer be travelling to their workplace outside of Ireland if they are now working from home.

Revenue have confirmed that if employees are required to work from home in Ireland due to COVID-19, such days spent working at home in Ireland will not preclude an individual from being entitled to claim this relief, provided all other conditions of the relief are met. 

Foreign employments – operation of PAYE
Where an individual working for a foreign employer spends some of their working time in Ireland, this may give rise to a payroll obligation on the employer in respect of those workdays, subject to certain exemptions.

Revenue have recently confirmed that they will not seek to enforce Irish payroll obligations for foreign employers in genuine cases where an employee was working abroad for a foreign entity prior to COVID-19 but relocates temporarily to Ireland during the COVID-19 period and performs duties for his or her foreign employer while in the State.

PAYE dispensations
Where employees on foreign contracts of employment spend in excess of 60 workdays but less than 183 days in Ireland in a tax year, their employer may apply for a PAYE dispensation to allow for the release of the obligation to operate PAYE in respect of their Irish workdays, subject to certain other conditions being met. A PAYE dispensation must be applied for within 30 days of an individual’s arrival to Ireland.

Given the unprecedented circumstances and the restrictions on travel as a consequence of COVID-19, Revenue have confirmed that they will not strictly enforce the 30-day notification requirement for PAYE dispensations. 

PAYE exclusion orders
Where an Irish employee is working outside of Ireland for an extended period of time, a PAYE exclusion order may be in place whereby the employer is not required to operate PAYE in respect of their employment. To qualify for a PAYE exclusion order, all of the employee’s Irish duties must be carried out abroad. Revenue allow for incidental days to be spent in Ireland i.e. 30 days. 

However, Revenue have confirmed that the individual’s position will not be adversely impacted where the employee works more than 30 days in the State due to COVID-19.

For additional information on any tax matters, please contact a member of our tax team. We are here to help.

Grayson Buckley, Partner, Tax - Crowe Ireland
Grayson Buckley
Partner, Tax
John Byrne, Partner, Tax - Crowe Ireland
John Byrne
Partner, Tax
Lisa Kinsella, Partner, Tax - Crowe Ireland
Lisa Kinsella
Partner, Tax
Andrew Whitty, Partner, Tax - Crowe Ireland
Andrew Whitty
Consultant, Tax