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Irish Limited Companies - The Facts In 2 Minutes

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Irish Limited CompaniesIreland

Ireland is one of the longest established low tax jurisdictions within the EU.

It holds many attractions for international businesses, including a 12.5% corporation tax rate.

Other notable attractions include:

  • Favourable tax treatment of dividend income;
  • No withholding tax on dividends from Irish holding companies to EU / tax treaty countries;
  • No capital gains tax on disposal of shareholdings in qualifying subsidiaries;
  • No capital duty on share issues;
  • No controlled foreign company rules;
  • Favourable tax regime for qualifying R&D / Intangibles;
  • Tax deductions for interest on certain qualifying borrowings;
  • Favourable withholding tax regime for interest and royalty payments; and
  • Both certificates of tax residence and VAT numbers can be obtained for qualifying companies

 

The Facts

Formation:

Approx. 5-10 working days

Shelf Companies:

Not available

Authorised Share Capital:

Unlimited and no restriction on currency

Issued Share Capital:

Minimum paid up share capital = 1Euro.

Directors:

 

  • Minimum number of directors is 2
  • At least one director must be resident in a member state of the EEA (alternatively a bond can be entered into by the company, or else the company needs to successfully established that it has a real continuous link with the State)
  • Corporate directors not permitted

Secretary:

 

  • Obligatory
  • No restriction on residence or nationality
  • Corporate secretary permitted

Shareholders: 

 

  • Minimum number of shareholders is 1
  • Corporate shareholders permitted

Public Filing: 

 

  • Audited financial statements must be filed within nine months of financial year-end (exemptions available from audit requirement)
  • Annual return must be filed every year

Corporation Tax rates: 

 

  • 12.5% for trading income with “substance” in Ireland
  • 25% for all other cases.

Corporation Tax returns:

Must be filed within eight months and 21 days of financial year-end.

Capital Gains Tax:

Effective rate of 25% applies on capital gains 

Withholding Tax:

Dividends:  20%*
Interest:  20%*
Royalties:  0% or 20%*

Double Tax Treaties:

54 in effect (62 signed)

Certificate of Tax Residence:

Can be obtained for qualifying companies

VAT Number:

Can be obtained for qualifying companies

Transfer Pricing regime:

Applies, but with exemptions for qualifying small groups

Sales/Value Added Tax:

EU VAT regime


(*In most cases can be reduced / eliminated by careful planning / double tax treaty relief)

 

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