Relevant Contracts Tax (RCT)
RCT for non-resident subcontractors
RCT also applies to non-resident subcontractors. If the work is being carried out in Ireland, a principal contractor should deduct RCT from your gross payment. This is the case even if they are also non-resident. If they do, they must provide you with a copy of the deduction authorisation.
If you are registered for RCT, you can apply for a refund during the year. The International Claims Section in Nenagh will deal with your refund application.
To claim a refund of RCT, you must complete:
The tax authority of your country of residence must certify the Forms IC1 or IC3. They must certify the forms in the year that the income was earned.
You must send a copy of the deduction authorisation, along with these forms.
Payments without deduction of RCT
You may have applied for and received a 0% RCT rate from Revenue. If this is the case, the principal contractor must still submit a payment notification to us and will receive a deduction authorisation. The principal contractor will make the relevant payment to you without deducting RCT.
To qualify for the zero RCT rate, you must have an up-to-date compliance record with us.
Value-Added Tax (VAT) reverse charge
The person supplying the goods or services normally charges VAT. However, under RCT, the person receiving the goods or services (the principal contractor) accounts for VAT to Revenue directly. The principal contractor accounts for VAT as if they had supplied the service. This is known as VAT reverse charge. It applies to subcontractors involved in the construction industry only.
Non-resident subcontractors who provide construction services to principal contractors are not required to register for VAT. However, you may wish to do so in order to claim credit for any VAT paid.