Domestic skills shortages and the uncertainty surrounding Brexit are driving demand for both short- and long-term contract roles to be filled in Ireland.
As a result, enquiries from UK contractors considering positions in Ireland has tripled between 2016 and 2017. Sinead Doherty, CEO of Fenero, a company which specialises in tax advice for contractors and freelancers, discusses this occurrence.
The reason(s) for the Irish skills shortage
When asked why there is a skills shortage in the contractor sector, Doherty said it boils down to the level of unemployment being at its lowest for about ten years and businesses struggling to fill the demand.
“As Ireland’s level of unemployment is at its lowest in a decade, it doesn’t come as a big surprise that many employers are now reporting difficulties in recruiting skilled candidates in the past year. Continued FDI into Ireland is a factor plus the growth of domestic and international companies located throughout the country.”
Many innovative and high-demand industries also take on a lot of contractor workers.
“Contracting is a common employment structure in many of the sectors which are experiencing strong growth, including tech, engineering and pharma. The result is that we are seeing increased demand for skilled contractors in these sectors.”
The cost of living is also a major variable: “Another factor is the rising cost of accommodation in Dublin, which presents challenges for recruiters and employers to pitch it internationally as a great place to live and work.”
In this area Irish businesses may look to the UK to fill the void in contract workers. “The size of talent pool in the UK compared to Ireland is massive. Due to uncertainties surrounding Brexit and the UK market lacking confidence, the UK is a natural hunting ground for Irish companies seeking talent”, said Doherty.
The Fenero CEO also mentioned her company’s involvement in working closely with Irish recruitment agencies. Doherty said, “… lack of knowledge of the tax rules surrounding non-Irish limited companies operating in Ireland was leading many businesses into being reluctant to engage overseas contractors to meet the current skills gaps.”
She continued: “Fenero was one of the first accountancy firms to specialise in providing tax advice to freelancers and contractors and we regularly provide advice to UK contractors about how they can work in Ireland.”
Doherty said this issue is more than a short-term problem as UK workers are a great source of filling gaps in Irish markets.
“Mobile UK contractors are an excellent source of talent for Irish companies and contracting is a very popular career option in the UK.
“As a result, many are highly skilled in their respective industries and can offer significant levels of expertise to employers.”
This may be so but tax compliance is hindering potential workers coming to Ireland. Once informed of the actual guidelines, contractors are actually pretty comfortable with what is needed. However, confusion is still rife.
“… we have found quite a wide scale level of confusion surrounding how UK contractors can operate in Ireland and this is a key factor as to why many do not take up roles here, especially if they wish to use their existing UK limited company structure.
“But as we regularly tell people, there is no obstacle that prevents UK contractors from working in Ireland. There are necessary, yet simple, steps an individual can take to remain legally tax compliant while using their existing UK company structure.”
How do we combat this?
Keeping people up to date and compliant is the simple solution and one which will be fruitful and beneficial in the long run. It can, however, be difficult to keep on top of tax, though not impossible by any means.
“Tax can be complicated. However, it is not rocket science. We keep our contractors and freelancers on the right side of the law whilst ensuring they know what reliefs and expenses they are entitled to claim so they maximise their earnings from the contract.
“We also liaise with the contractor’s UK accountant as needed, to make the tax compliance across two jurisdictions robust and as hassle free as possible for the contractor.”
Fenero, as an accountancy and tax professional agency, can help alleviate this skills-gap issue we currently have in Ireland and advise workers on tax, encouraging more people from the UK to come over to help with our growing demand.