I have been working for myself for last 8 years after completing my masters, in hindsight financially I did not do too badly (tho there was some great and ups and incredible downs!) and it is NICE working from home and watching your kid grow (tho there are quite a lot of distractions!!! says he who is procrastinating reading HN :D )
BUT if I was offered a job with guaranteed employment and steady wages and (gaaasp pension!) like being a teacher I would go for it. Having kids changes your perspective.
I would have been financially much better of if it wasn't for punitive taxes in Ireland, here you reach ~53% high tax rate with only about ~$35K in income. And then there are new property/water taxes they brought in now as well as 23% VAT :(
All of these taxes really make you ask yourself "why bother work harder and longer" and really kill any incentive to work.
And no we do not get free healthcare here still need to pay for medical insurance out of aftertax earnings. And as a business owner I do not qualify for the full welfare if things go to shit, despite paying high rate of social taxes.
edit: Now that I read my rant in second half of my past, no wonder no good startups come from here, the atmosphere is toxic to entrepreneurship.
I did exactly this. Was contracting for 8 years in Dublin, commuting almost 3 hours daily. I was making good (but not amazing) money. Then the kids came, and that 3 hour commute became 3 hours that I could spend helping my wife or spending time with my kids.
Got offered a full-time job in the tech industry with (gaaasp pension!) outside of Dublin, 5 minutes from my front door, with better salary, bonuses and healthcare. Things can work out well (and I really don't mean to sound patronizing here) with patience and a bit of luck.
> Got offered a full-time job in the tech industry with (gaaasp pension!) outside of Dublin, 5 minutes from my front door, with better salary, bonuses and healthcare. Things can work out well (and I really don't mean to sound patronizing here) with patience and a bit of luck.
While it seems to have become the trend to rail against traditional 40 hour/week jobs, the stability they can offer it extremely enticing to people with families. Eevee lives with 3 other grown adults and no children.
As someone looking to make the jump from a traditional job to financial independence (and self employment), I've noticed that people like Tim Ferris and Ramit Sethi all have one thing in common: no children. They are able to take the risks they can because when they fail, it's only on them.
With kids and a house, it's no longer the case. The people I follow who have successfully made the transition (Mr. Money Mustahce, Simple Programmer) have all used the traditional job as a means of support until they were ready to launch.
Also, there is nothing fundamentally wrong with just wanting to put in 40 hours and go home.
With kids and a mortgage, my perspective definitely shifted. I could have continued on doing what I did with the contracting, but I know for a fact that my family life would have suffered as a result. Having a 40 hour a week job is great because it gives me the ability to plan better for my family, in terms of time and money.
Yes, it does feel 'transitional' but that's not necessarily a bad thing. I really like the company that I now work for, and I still have time to work on 'side projects' at home whenever I feel like it. It's also a hell of a lot stressful. I have the ability to 'let go' of work stress a lot easier than ever before.
A pension? I've never heard of a pension in tech (though I am from a different country than you). I've never heard of companies taking part of their earnings to invest in the well being of their people. The most I have heard of are perks like ping-pong, a free beer once in a while, and conferences. They often even give you a computer to work on! And a chair to sit in!
(I kid you not, these are often listed as perks in tech job ads)
Obviously startups are not the place to look for a pension but I haven't even heard of established companies in tech offering them.
Seems like a dead-end career if you care about retiring and sending your kids to a decent school (if that's what they want). My grandfather-in-law was set for life when he retired as a mechanical engineer. I'm in my mid-30s and I don't see my career ever ending and my financial future seems like it will always be at risk no matter how I invest and manage my savings.
What kind of company, might I ask, offers such a rare thing?
Outside the US the term "pension" also is used to mean that the company pays into some(semi-) government scheme that provides a pension. I think the company itself paying the actual pension when you retire is a US only phenomenon.
I can't speak for the person you replied to, but I live in the Netherlands and here (and if I'm not mistaken in most of Europe) offering a pension plan is obligatory for companies in most sectors, including tech. Then again, our perspective on these things is quite different from for instance the USA, health insurance is not an option, it is obligatory.
A private pension (where the company pays for retirement) just doesnt make sense when lots of major tech companies havent even been around for a decade. This model was a better fit for when companies would last 50+ years and people would have their entire career at a single company.
These days its better handled by a federal/social investment fund that all companies contribute to and then pays out to each individual. But that's basically social security.
Way to ignore USC (Universal Social Charge) and PRSI (Pay Related Social Insurance), these two alone + income taxes add up to over 50% rate on every euro earned above about 32-33K
thats without even going into property tax which could also be taken out of your income (and probably water tax soon)
The government has deliberately made the "income" taxes so complicated with 3 major different variables, and plenty of other minor nuances dependent on the persons circumstance
In my case for 2014:
----
Gross Pay €32,876.69
Income Tax €4,941.44
USC €1,620.17
PRSI €1,315.08
Net Pay €25,000
----
Thats for tax year 2014 (wasn't married yet, own company director), any euros earned above this I would have had to pay a rate of 50%+ tax (income+usc+prsi),
This year it is a little less (few hundred euro) due to getting married and budget 2015 being a tiny bit more forgiving.
You have ignored PRSI and USC and ignored that company directors lose a good chunk of their tax credits (and to add insult to injury no longer qualify for full welfare when things go bad!) for bothering to start a company, I suppose you work for someone else and do not comprehend how toxic the tax regime is towards small businesses. Revenue views all small business and sole traders with absolute disdain the EXPECT them all too be crooked and ASSUME you are guilty of tax fraud and place the onus on you to PROVE you are innocent of any tax misdoings (which costs time and accounting money)...
ys1010 is (accurately) describing the marginal rate which effectively applies to all income above a threshold (although the different taxes/charges have different thresholds). It’s quite the thing when it kicks in.
Nope. I'm Irish and confirm those figures. There is no city or local taxes in Ireland. (Ireland, with a population of 4.5mil isn't split into many different juristicions like the USA)
It is (was) great for Ireland, though. That's how they attracted tons of (large) tech companies to Ireland. It's the perfect match: low corporate tax, no incentive for people to go away and do their own startups, which means you can get paid less as there as less alternatives for you. Very smart play by Ireland.
Then, the EU went back to them and told them they couldn't keep doing this, and very soon (is it 2016?) they will rack up corporate tax and make a fortune. And if you're Google, you built a large office and hired thousands of people, you're not going to leave anytime soon.
> And if you're Google, you built a large office and hired thousands of people, you're not going to leave anytime soon.
You think? I don't think big business tends to fall into the sunk cost fallacy like we do. It may take a year to move out, but if they save no money in Ireland over the US, why stay?
There are no plans to change the corporate tax rate and the EU have no jurisdiction in these matters.
What is happening, rightly so, is the dismantling of some mechanisms which allowed large corporations to avoid paying the corporation tax at all. I think, though not sure, that this includes dismantling the double-irish arrangement where companies declared the majority of their income as expenses for licensing the product/brand etc from a parent company.
Go to Poland - 19% flat income tax rate for companies - you can get flat by 400 euro / month in biggest cities and work remotely for foreign clients.
To expand on this: one can operate as a sole trader company, and enjoy the 19% flat income tax rate. You can also register your company for VAT, and then claim back the VAT on company purchases.
The only other cost is ~$270 / ~240 EUR / ~180 GBP per month in social insurance taxes.
I've been here for the last five years, and the low cost of living (very low cost outside of Warsaw) combined with low taxes makes Poland a very forgiving place to be when your first few side businesses inevitably fail.
(for that matter, the startup community here in Warsaw, centred somewhat around Reaktor - http://reaktorwarsaw.com - is really picking up steam)
If you do what I do - remote consulting for clients in the UK and USA - and you have the talent to charge western rates, you can build a sizeable nest egg in next to no time.
You know what sucks. As an American I'd still have to pay American income taxes. I cannot wrap my head around how we can say that's ok. Sure, there are ways to get around a portion of the taxes, but those involve things like never coming to the US for more than a set (short) amount of time.
No! You would not have to pay American taxes on the income you have earned while living abroad. There is the foreign income exemption which essentially says that the IRS does not care to tax the first $100,000 you earn. For taxes above that, you first deduct dollar for dollar what you have paid to the foreign tax authority. Ball-parking it, you would have to earn more than $180,000 per year to need to pay US taxes. You still have to file US taxes, which is a cost and an inconvenience, but is manageable.
Of course, you must be genuinely living abroad to apply for this. This means either spending enough time outside of the US (> 330 days in a tax year, if I recall correctly) or have enough proof that you are really living abroad (things like primary residence in your name, bills, bank accounts, mortgage, insurance, kids at school -- regular every day stuff).
Now if you want to game the system and just "kind of" live abroad in order to take advantage of the income exemption, that's a different story.
> Sure, there are ways to get around a portion of the taxes, but those involve things like never coming to the US for more than a set (short) amount of time.
I know about being an expat and how to avoid SOME of the taxes. Point is, unless you make under that limit and don't spend more than a month per year in the US, you are liable for US taxes. They give credit for foreign taxes paid, but you'll basically be paying the US income tax rates when it's all done. Not to mention the sheer stupidity of having to file in the first place.
On personal income. It sounds like the UK's "IR35" loophole - if you leave the money in the company you don't have to pay tax on that. So you can accumulate capital in the company.
You know what sucks. As an American I'd still have to pay American income taxes.
Agreed, it always feels scandalous to me whenever I hear this fact.
No idea how it works in practise. I known plenty of Americans who have settled in Poland for a good portion of their lives, so it must be possible to overcome the burden.
Maybe it's one of those things where, as long as you can afford to pay a good accountant (and you really should be able to afford it in Poland), they take the pain away for you?
This is false, false, false. Please everyone, if you stay out of the US for ~ 330 days a year, you are untaxed up to about 100k (changes every year). I've done this 2 years and the savings are insane. Federal income taxes are a huge drain on your salary. Go abroad!!
You're also exempt from the Obamacare penalty for not having health insurance if you're out of the country for 330+ days per year. For 2015, it's 2% of your income, and next year it will be higher.
The penalty is 0.1666% per month you didn't have qualifying health insurance for any 3+ month period(s) you didn't have it, e.g., if you didn't have insurance in the months of February-April, you'd be assessed a fine of 0.5% of your income.
I mention that there are ways to avoid some of the taxes. I've BEEN an expat so I know how it works.
I also know that I still had to pay taxes even when I stayed out of country long enough just due to income levels. Additionally, with all of my family in the US it was pretty hard to stay out of country enough to avoid taxes.
Am I saying you shouldn't move out of the country? NO! I loved living in Europe. And if you live in a low cost of living country you will save lots of money if you get a US salary or contracts. What I am saying is that as an American you'll likely end up still paying US taxes and you'll still have to file with the IRS every year.
Isn't Bulgaria due to join the Schengen area pretty soon? Inside the next couple of years, at least?
It should have been included together with Romania a couple years ago.
The problem is that both countries are still considered too corrupt for inclusion into the Schengen treaty. Romania seems to have cleaned up their act better then Bulgaria, but there are still grave doubts that the countries behave according to the treaty and don't, for example, sell visas to people, who are not eligible for them.
To the best of my knowledge, both countries are still on an waiting list, but given the current anti immigrant sentiments in most of central Europe this could take a few more years minimum.
Note that I'm not singling out the countries as crooked I'm just stating facts. Organized crime, for example, is still a huge problem in Bulgaria and corruption is still a huge problem in both countries. [1]
- The state's still transitioning from a post-communist economy.
- Wages are very low.
- Relatively high emigration rate "brain drain" (although people are starting to return).
- More supply, less demand.
You can buy a brand new apartment close to the centre for somewhere around $2000 per square metre / $200 per square foot. Depending on how your housing market work, that's either scandalously high, or shockingly low.
It is however, very very affordable as soon as you start earning a reasonable wage.
But these were the prices for a big, vibrant city. If you go to places with worse economy, it can get as low as $600 per square metre - in/near a nice historic city cente. And there are virtually no guns or organized crime in Poland, so even in poorer areas there isn't that much to be worried about in terms of security.
It's cheap if you're coming from a developed nation and are comparing local costs with what you earn there.
Remember, the average wage in Poland (according to GUS) is around $12750 yearly, so a $550/mo apartment (the average, from what I know amongst friends) in Warsaw is quite expensive for the average Pole.
So, why are wages so low? Well, we'd like to know as well :).
The only problem is communication with government, rather impossible without polish.
Very true - and very difficult at first, if your Polish is rather poor.
That said, my Polish was terrible, and I managed to bluster through it.
I recently helped an acquaintance through the process, and it turned out I'd done it the wrong way around. First hire a good accountant (mine costs slightly more than usual at $100/mo, thanks to processing many many many invoices/mo), sign over power of attorney for submitting tax documents, and they'll take care of the rest for you.
I can't speak for Kraków, as I've only had a family since being in Warsaw.
I think Warsaw's great. Plenty of green spaces, lots of child-friendly environments, and it's pretty easy - if you choose - to find yourself living in a community of similarly-aged kids where they all look out for one another.
The only downside I can think of is navigating stuff like vaccinations, doctors, and general bureaucracy. The majority you'll be fine with, but some working Polish - and having Polish friends - will be helpful as English is in short supply in some vital areas.
I guess you can do the routine stuff in private health care, where they actually care about the quality of service (so they should be able to communicate in English). It's not really expensive too; in Warsaw appointment with a specialist (cardiologist etc.) is $25-$50.
For serious stuff (like surgery) it's best to go with public health care though.
I dunno, I think it's very dependent on the health provider in question. I've had some shockers from Lux Med, both in terms of incredibly bad service (eg doctors clocking off early and then claiming I turned up late, despite being obviously and easily provably false), and issues with a lack of English speakers, despite being assured that it wouldn't be a problem.
In fact, they're bad enough that I actively campaign against them.
Whoops, turned into a rant there by accident, sorry about that :)
Thanks to the Internet numbing my moral compass, it's not often I'm shocked, but 53% is just horrifying :(. On the other foot, I live in Australia where most can't afford to buy a house in Sydney, even with what would be considered pretty good wages.
That's why I moved out of core tech and became a librarian (which is still pretty tech) in a more regional city. Lower wages but slightly more affordable houses mean I might still have a chance at giving my kids a mortgage one day..
In addition to the other responses, remember that US federal income tax is a graduated tax rate, so even at ~40% on 120k, you're only paying 40% on your income over like 90k, lower tax rates for income in lower brackets.
Between that and the cost of property in Dublin (rental prices are insane at the minute, and I haven't looked at buying but I figure it's the same) that's why everyone graduating in ireland is leaving
I'd love to get some links to these high-paying jobs in Dublin? Last I checked, IBM were offering sub 30k for graduates, and Microsoft weren't far off the same amount. In US terms, that's 34k USD, for a city where you'll spend 800 dollars a month of your salary on renting a room, and another 170 dollars on communting by bus.
> Last I checked, IBM were offering sub 30k for graduates
You expect to walk into an 80k a year job straight out of college? Everyone has to start somewhere. If I was a graduate, I'd much rather be working sub 30k for IBM than sub 40k for Dublin's next Groupon killer/Airbnb for iguanas.
You just said:
> there are plenty of really well-paying job in the tech industry.
And I can walk into an 80k job outside of Dublin. Considering the cost of living in Dublin vs the salary for tech grads versus... anywhere else in the world, you'd be crazy to stay.
> Considering the cost of living in Dublin vs the salary for tech grads versus... anywhere else in the world
London, Singapore, Tokyo, Hong Kong, Paris... all way, way more expensive than Dublin.
But if you can find a job that will pay 80k euro equivalent to a graduate with a computing degree from a Dublin university and zero industry experience, you should definitely take it, 100%, and I wish you the best of luck.
Describing people who want to do this as 'idiots' was too harsh of me. It just makes me sad to see young people leaving the country.
> London, Singapore, Tokyo, Hong Kong, Paris... are all way, way more expensive than Dublin.
From a brief google, Tokyo looks comparable to Dublin, but the others, yes. However, I wouldn't take a job for 30k living in any of those cities either, that's just nuts. However, it is absolutely possible to get jobs in places where your ratio of cost of living to salary is better than it is in Dublin, even before you factor in how much more you would take home before you end up paying the nuts VAT rates, PAYE, PRSI, USC charges that push you into almost 53% tax at 32k euro. I moved to Edinburgh when I graduated, and forgetting about my salary, my rent is a good 300 euro less a month, my transport bills are lower, I live in a nicer flat than I did before, and general costs of living are lower than they were in Dublin. I have more disposable income than I would have had on the same salary, and the ballpark offers that I have received here are the same as, if not better than home.
The reddit thread in [1] has plenty of people who came out at over 80k euro starting salaries. I'm not saying that everyone can get it, but there are some available.
Firstly, not everyone works in tech. But even from that perspective Dublin tech salaries do not offset the taxes and cost of living there to the point of being an idiot for leaving. Particularly if you're a high earner paying the punitive tax rates here.
In my case I could move from Dublin to Silicon Valley and make 30% to 50% more cash and pay way less in taxes, I would be an idiot to not consider it.
Some source on Irish taxes? Last time I checked income tax in Ireland was one of lowest in Europe. Bellow €40K (+-) was 20%, everything over 40%. Same income in Germany is taxed way higher.
Try this calculator, in the last few years taxes have increased a lot. Also keep in mind if you are a director of a company (Startup etc) you lose a good chunk of your tax credits
A single 30 year old (average age of HNers?) earning €100K
will receive €58,869 after all the income taxes
From this money he/she will have to then pay water tax, local property tax (if renting the landlord will pass it on), VAT of 23% on almost everything and so on, and god help you if you buy a car!
---
41% is the highest tax band
BUT
there is also USC and PRSI tax which needs to be paid
which brings up the highest rate to above 50%
basically there are a lot of hidden taxes and it is a very complex tax system which allows the government to make the figures appear palatable
If you can't live well €100K in Ireland you are doing something wrong. Do you realise that you are in the top ~12% of household income with that sort of money?
I do sometimes wonder what kind of self-awareness people have of their status.
A lot of HN readers are from US and would be shocked at the tax rates here (on everything) and they further shocked as to how little we get to see for our tax money (no free healthcare etc)
It's very difficult to compare like for like though.
For example, US property taxes are a completely different animal than Irish ones and by and large they are massively higher. Healthcare costs are not free in Ireland but they are significantly lower than in the US. And if anything really bad happens to you or your children in Ireland you are financially far more secure.
The US always appears to have a much lower tax rate but once you compare similar lifestyles things are not as different as you might imagine.
I agree there are so many variables to consider when comparing and the US itself has a wide range of living costs and salaries across the 50 states.
BUT here in Ireland the government has made it an artform in introducing indirect hidden taxes which on a quick glance one might miss and quickly add up. for example: Americans would be shocked not only at our petrol prices but the total cost of running a car (and no the public transport is not great) for example and property taxes have come in and are widely expected to rise year on year and will probably be at US levels in 10 years.
I have been to the US many of times and traveled across almost all the states so it is not just case of "grass is greener on other side"
I just had a look at the numbers, UK vs IE you're about 10% worse off in Ireland in terms of take home pay. Then as you say, you need to pay another X grand on health insurance. That's a pretty raw deal.
What a crappy system, to simultaneously make it great for corporations and bad for workers.
There have to be some other major upsides that I'm not understanding. It's a pretty country, that's something :)
Social insurance, health insurance and income tax will be around 25% on €15k annual salary in Czech republic. And that's assuming they have no children. With children it's even less.
Except the VAT and petrol tax have nothing to do with income tax. So you can't just add it to the ~40% income tax. 21% VAT is quite normal in the EU, so that's nothing special.
Yeh me and my kids will be paying for a long time for the worlds biggest banking (per capita) debacle and the destruction of the economy in the 00s by various governments. With kids its sort of hard to leave :( Tho' it is a nice place to live despite all the carry on.
But hey look over there at the news yet another multinational setting up to launder/funnel money onto somewhere warmer and seems like a housing bubble is re-inflating again.
--------
edit: last year i arranged my salary to remain under the high tax rate band
Gross: €32.6 K
Net (after PAYE,PRSI,USC): €25 K
The accountant said that above this €32K line i would have lost about ~53 cents in taxes for each €1.00 earned by ending up in the highest tax band...
So I left the extra money in company (corporation tax 12.5%) and will spread out my wages over few years, tho is risky practice if the company gets sued and loses the money.
There is an option to pay into a pension but with the pension funds being so mismanaged and the government actively robbing all pensions and destroying the pension reserve that would be downright stupid.
Set up a trust or a separate management company that cannot be easily sued (only one client: your other business). If for some reason Irish tax law doesn't work for this case, you can probably set up a foreign owned management company or quality assurance company. Another option is to buy business insurance for lawsuits, though really do you research and record the call you have with the rep because he will promise you things that are not true. If you don't have one party consent for phone calls in Ireland do it from a country that does.
Yeh the problem is you do not want to cross Revenue, they do assume your are guilty and you have to prove your innocence when it comes to tax matters. Best if possible not do anything which they might interpret as dodgy.
I just can't imagine it - "Great, you got a pay rise! Now you get to take home less, until your pay rises by another $5,000!"
Edit: On second reading, I think I understand what the OP is talking about: leaving money in the company they operate, which pays out (I guess through dividends?) at a lesser tax rate than if it were paid out directly as wages. I'm pretty sure this is a standard technique in the rest of the world, and not particularly unique to Ireland.
Does any country out there not tax progressively?
I just can't imagine it - "Great, you got a pay rise! Now
you get to take home less, until your pay rises by
another $5,000!"
He's just whining. At no point under the progressive tax system do you get penalized for earning more: the first $35K of your income is still taxed at the lower rate. When you earn dollar number 35,001, that dollar is taxed at 53%, but your average tax rate only goes up a hundredth of a percent.
This misunderstanding of how tax brackets is so widely pervasive that I can only assume it's the work of enemy action: people who want to reduce income taxes, or to move the tax burden to the poor by implementing a flat tax rate.
He's still paying a significantly higher tax rate on that dollar than if he didn't earn it this year.
If he is not hurting for cash and he could defer it until next year (or year after that) with no penalty at all and (arguably) negligible risk, thus paying the lower personal income tax rate on that dollar, why not do it?
I don't see what part is misunderstood. If you're being paid by your employer, obviously you want to take the raise regardless of higher taxes. If you are your own employer, both entities are paying taxes and each dollar of taxes paid is coming out of your own pocket.
The money doesn't appear out of thin air. It takes time and stress to earn each euro. Especially if you work for yourself or in a startup, you are probably working for someone else so you do not comprehend the perspective of someone who is trying to make his own way in the world.
The tax system here puts a huge disincentive to work hard and earn a lot, at least there is an option if you have your own company to defer and stretch your wages over longer period BUT that comes with all sorts of risk since IT IS NOT YOUR MONEY but company money and corporation tax.
That's very short-sighted. If you are incorporated for yourself then:
> each dollar of taxes paid (by either entity) is coming out of your own pocket
You can keep it in pocket A, the corporation, and pay taxes once (on profits only, I guess), or move it to pocket B and pay taxes a second time also, at a much higher rate (and on overall income, again a larger basis than it would be to count up personal profits.) If you can replace some personal expenses with corporate expenses, end-around pocket B completely, now your business has also made less profit, so pays less corporate tax. I am not a tax accountant (or even remotely skilled in taxes) and this is not tax advice, but it makes pretty good sene to me. Certainly some part less than all of what I suggest would be considered illegal tax dodging or corporate malfeasance.
Sounds like a good incentive for CEOs/majority owners of small businesses to live frugally and to refrain from looting their corporate coffers excessively. Sure, a bird in the hand is worth two in the bush, but it also seems very clear to make the case that two whole birds in the bush are worth more than 0.94 birds in the hand.
That's approximately how I read it. Even if it's his company, money he puts in his own pocket needs to have income tax paid on it (I would suppose this means, after any appropriate corporate taxes are paid by the corporation).
If the money does not actually leave the company and go into his pocket, the only taxes that would need to be paid are those (low) corporate taxes.
Of what value is money you can't have in your pocket and spend, of course, is an exercise for the reader, but presumably it could be paid out as personal income over a greater number of years (if the company survives that long) without ever paying $0.53/1.00 in personal income taxes on any portion of that money.
This is what I do. I worked hard for three years, pay myself a wage thats in the minimum pay bracket and will travel until the company money is gone. I'm not give a cent more than I have to to those crooks.
Really it's the no healthcare that is the issue. How can you tax your residents so much and not provide healthcare? My payroll tax rate in Canada is about 30% on ~$55K
There is "free" healthcare if you are unemployed and qualify for a medical card, tho if you open the newspapers any week you would hear all sorts of horror stories about our public hospitals. The public system is under immense stress after years of negligence and cuts so your experience of a public hospital might quite literally be your last.
If you are employed you have no choice but to pay for private insurance:
* Family with 2 kids ~ €2600 per year
* Singe person ~ €500-€1000 per year (dependant on age etc)
Tho the costs for health insurance are rising of course...
Good lord, 53% tax plus 23% VAT plus utilities tax plus monthly healthcare premiums plus...?
I'm a bit of a socialist living in the U.S. - I believe in higher taxes on higher earnings and universal healthcare - but what in all that is holy do you get for your tax money??
Good lord, 53% tax plus 23% VAT plus utilities tax plus monthly healthcare premiums plus...?
The OP's overstating their case a bit, see the tax calculator here: http://services.deloitte.ie/tc/ (you'll get close to 60k in your pocket from 100k.)
Actually I was discussing that once you reach the low threshold for higher rate tax of about ~€32-33K every single euro above this will be taxed at over 50%, below this its about 20-25% depending on a wide range of circumstances and variables.
This punitive tax regime makes you question as to why bother working longer and harder and kills any will to start new projects since you know you will be robbed if you ever (in the unlikely minority) become successful
AND to add insult to injury you do not get much for your taxes and from your after tax income you endup paying all sorts of further hidden taxes just to live here.
Actually I was discussing that once you reach the low threshold for higher rate tax of about ~€32-33K every single euro above this will be taxed at over 50%, below this its about 20-25% depending on a wide range of circumstances and variables.
Honestly, I'm genuinely not scandalised about the rates you've listed; they seem pretty standard for Europe.
This punitive tax regime makes you question as to why bother working longer and harder and kills any will to start new projects since you know you will be robbed if you ever (in the unlikely minority) become successful
A top rate of 50% isn't that scandalous. It's a lot, and there are plenty of means to reduce it. Personally, I'm far more concerned about getting the point where the top tax rate is a serious problem for me in the first place.
AND to add insult to injury you do not get much for your taxes and from your after tax income you endup paying all sorts of further hidden taxes just to live here.
I fear that if you think living elsewhere is going to result in a major change on your life from the tax rate alone, the options are few and far between. I've heard that you either love or hate Dubai, for instance.
(of course, there are always exceptions on prices of e.g. clothing, computing goods etc. etc. Always idly tempting to imagine moving somewhere that doesn't have VAT!)
I was hoping for a nice pie chart on http://www.budget.gov.ie/Budgets/2015/2015.aspx , but no. Can't seem to find one on the internet. If Ireland is similar enough to the UK, then a large chunk of it will be on pensions.
>> but what in all that is holy do you get for your tax money??
Frankly, not much.
I was born and raised in Ireland, and left a few years ago from Scotland. In comparison to Scotland (and the UK in general), the quality of public services in Ireland is a joke.
BUT if I was offered a job with guaranteed employment and steady wages and (gaaasp pension!) like being a teacher I would go for it. Having kids changes your perspective.
I would have been financially much better of if it wasn't for punitive taxes in Ireland, here you reach ~53% high tax rate with only about ~$35K in income. And then there are new property/water taxes they brought in now as well as 23% VAT :( All of these taxes really make you ask yourself "why bother work harder and longer" and really kill any incentive to work. And no we do not get free healthcare here still need to pay for medical insurance out of aftertax earnings. And as a business owner I do not qualify for the full welfare if things go to shit, despite paying high rate of social taxes.
edit: Now that I read my rant in second half of my past, no wonder no good startups come from here, the atmosphere is toxic to entrepreneurship.