Ireland is simple to pay into and careful about status. Money moves in euros over SEPA, with instant payments at every euro-area bank since October 2025, and a business client abroad pays no Irish VAT on services. The part to get right is employment status. Since the Supreme Court’s Karshan (Domino’s Pizza) judgment in October 2023, Revenue expects businesses to run a five-question test for every worker and keep the evidence, and it has said plainly that some people treated as self-employed will need to be treated as employees.
Sole trader or limited company
Irish contractors work in one of two ways.
Sole trader. The person registers for tax with Revenue when they start trading, online through eRegistration (revenue.ie, checked 2026-09-29), invoices in their own name and files an annual self-assessment return. You contract with and pay the individual.
Limited company. A contractor who incorporates invoices through the company, which pays corporation tax of 12.5% on trading income and 25% on non-trading income (revenue.ie, checked 2026-09-29). Directors are office holders and always subject to PAYE on their salary (TDM Part 05-01-30, checked 2026-09-29), and certain company directors pay Class S PRSI (gov.ie, checked 2026-09-29). You contract with and pay the company, which signs a W-8BEN-E for a US payer.
Self-assessment: income tax, USC and Class S PRSI
A sole trader pays three charges on profits, all through the Form 11 return. The 2025 return is due on 31 October 2026, or 18 November 2026 when paid and filed through ROS (revenue.ie, checked 2026-09-29).
| Charge | 2026 rates |
|---|---|
| Income tax | 20% up to €44,000 for a single person, 40% above; credits include an earned income tax credit of up to €2,000 |
| Universal Social Charge (USC) | 0.5% to €12,012, 2% to €28,700, 3% to €70,044, 8% above; 11% on self-employed income over €100,000; no USC if total income is €13,000 or less |
| Class S PRSI | 4.2% of income to 30 September 2026, 4.35% from 1 October 2026; minimum €650 a year |
Sources: income tax bands and credits and USC bands (revenue.ie), the USC surcharge (citizensinformation.ie), Class S rates (gov.ie); all checked 2026-09-29.
A foreign client withholds none of it. Ireland’s contractor withholding regimes are sector- or payer-specific: RCT covers construction, forestry and meat processing (revenue.ie), and PSWT at 20% is deducted only by listed public bodies (revenue.ie, both checked 2026-09-29).
Employment status after Karshan
In Revenue Commissioners v Karshan (Midlands) Ltd t/a Domino’s Pizza, decided on 20 October 2023, the Supreme Court held that the chain’s delivery drivers were employees and set out a decision framework (revenue.ie, checked 2026-09-29). Revenue puts it as five questions (revenue.ie, checked 2026-09-29):
- Does the contract exchange a wage or other pay for work?
- Has the worker agreed to provide the services personally, with very limited or no option to delegate?
- Does the business control what, how, when or where the work is done?
- What do the facts and circumstances say about the true nature of the relationship?
- Does any legislation change the answers?
A “no” to any of the first three means the worker is self-employed, subject to question 5; three “yes” answers lead to questions 4 and 5. Revenue’s guidance adds that it expects evidence of this analysis when a worker is engaged, looking beyond the wording of the contract where appropriate, and a regular review as the relationship changes (TDM Part 05-01-30, reviewed May 2026).
The Code of Practice on Determining Employment Status is joint between Revenue, the Department of Social Protection and the Workplace Relations Commission, and was updated in November 2024 to reflect the judgment. Each body answers the question for its own purposes: Revenue for tax, Social Protection’s Scope Section for the PRSI class, the WRC for employment rights such as minimum wage and holiday pay (same sources). See also contractor misclassification.
For a foreign client, the stakes are payroll. A reclassified worker must be put on PAYE, and a non-Irish employment exercised wholly in Ireland falls entirely within the PAYE system (TDM Part 42-04-65, para. 3.2, checked 2026-09-29). Employer PRSI on weekly pay above €552 is 11.25%, rising to 11.40% on 1 October 2026 (gov.ie, checked 2026-09-29). Engagements that hold up are the ones where the contractor can send a substitute, decides how and when the work is done, and serves other clients.
Contract and IP assignment
- A written services agreement with the sole trader or the company, scoped to deliverables, rate and currency, with terms that match how the work really runs.
- IP assignment in writing. Under the Copyright and Related Rights Act 2000 the author is the first owner of copyright; the employer takes first ownership only of work by an employee in the course of employment (s.23). An assignment is not effective unless it is in writing and signed by the assignor (s.120(3)), and a signed agreement can assign future copyright so that it vests on creation (s.121). With a limited company, check that it holds the rights of the person doing the work, or have that person sign too.
- Moral rights can be waived, but only in writing signed by the author; a waiver can cover future works (s.116, all checked 2026-09-29).
- Independence terms that are true in practice: a real right of substitution, the contractor’s own methods and hours, freedom to work for others.
VAT and paperwork on your side
VAT. B2B services are supplied where the customer is established, in or outside the EU, so an Irish contractor charges no Irish VAT to a business abroad (revenue.ie, checked 2026-09-29). The standard rate is 23%, and registration becomes obligatory above €42,500 of turnover for a supplier of services (revenue.ie, checked 2026-09-29). An EU client needs the contractor’s intra-EU number on a reverse-charge invoice; Irish domestic-only registrations make no VIES returns (VIES Traders Manual, checked 2026-09-29).
US payers. Collect a W-8BEN from a sole trader or a W-8BEN-E from a limited company and file no 1099. The US–Ireland treaty was signed in Dublin on 28 July 1997 and is generally effective from 1 January 1998; its Article 14 taxes independent services in the country of residence unless the contractor has a fixed base regularly available in the other (irs.gov, checked 2026-09-29).
Keep the contract with the signed assignment, the invoices, proof of payment and a dated record of your five-question status analysis.
How to pay contractors in Ireland
| Method | What the contractor sees | Notes |
|---|---|---|
| SEPA or SEPA Instant | EUR on their IBAN, instantly or by the next business day | Name check (Verification of Payee) before each payment |
| Provider converting USD | EUR paid as a local transfer | Converts at a disclosed rate before the money reaches Ireland |
| SWIFT wire | USD converted by the receiving bank | AIB charges €6.35 to receive over €127, plus conversion |
Ireland has no currency control and has used the euro since 1999. Rails, fees and platforms compared side by side: how to pay contractors in Ireland.
Contractor of Record in Ireland
A Contractor of Record signs with the contractor and invoices you, so it stands between you and the contractor as the contracting party. 4dev acts as Contractor of Record — the contracting party for each contractor — which reduces reclassification risk. Deel, Remote, Multiplier, Native Teams and Rivermate sell Contractor of Record products as well; read the liability clause in the contract, not the product name. After Karshan, a COR fits Irish engagements that are independent in substance but close to your team day to day, and it keeps contracts, IP assignments and invoices in one place across a group of contractors. For engagements that are really jobs, use an Employer of Record instead. Compare providers in our COR rating.