IRELAND
REALISING A 12.5% CORPORATE TAX LEVEL!

There is little doubt that the Republic of Ireland is Europe’s most prestigious and credible company location benefitting from access to an unrivalled double taxation treaty network, EU membership (since 1973), the Euro, excellent infrastructure, the International Financial Services Centre (IFSC) and of course a corporate tax rate of only 12.5% for all genuinely trading companies. This all wrapped up in the EUs second wealthiest country (after Luxembourg) and a golfer’s paradise!

Ireland is not a Tax Haven but a ‘real’ location for your Company and hence must have a genuine Irish presence – A presence the SCF Group can ensure with its Management Centre located just 25 kilometres outside of Dublin right beside the M11 motorway in County Wicklow “The Garden of Ireland”.

The Good Things in Life ...

The Good Things in Life are never free and so it is the case with establishing a corporate presence in Ireland. Unlike virtually all ‘similar’ jurisdictions Ireland is not ‘black-listed’ by any 3rd party countries but this status is the result of some of the toughest management and control tests in the World.... It must be remembered that despite its modest size Ireland is one of the World’s great exporting nations exporting 1/10th of what the United States of America exports with 1/75th of its population! The benefit of working with the SCF Group is that we have, to the best of our knowledge, the only full service company management and conference facilities in Ireland that include extensive facilities for visiting directors and beneficial owners including guest suites, swimming pool, sauna, tennis court and of course 5 minutes proximity to the world famous Druids Glenn Hotel and Golf Course.

“Ireland is not a Tax Haven but a ‘real’ location for your Company and hence must have a genuine Irish presence – A presence the SCF Group can ensure with its Management Centre”

The requirements for an Irish 12.5% Corporate Tax Company

For an Irish company to benefit from the 12.5% corporate tax rate it must show that its profits derive from carrying on a trade and not simply through ‘passive’ activities such as making investments and/or receiving royalties. Where activities are deemed ‘passive’ the corporate tax rate is 25% and not 12.5%.

 

The SCF Company in London

Establishing a Fiscal Residence in Ireland

Fiscal residence for a company is generally established by incorporation (S.23A (2) Taxes Consolidation Act 1997) but can be rebutted where the company is not deemed to be under control of a person either fiscally resident in another EU member state or a country with which Ireland has concluded a double taxation treaty. In addition, being fiscally resident may not in itself be sufficient as even after the payment of the 12.5% corporate tax rate the profits need to be distributed obviously without withholding taxes. To achieve this it is usually recommended that the Irish company is owned by a Cypriot company (i.e. the parent) as: A dividend paid by an Irish subsidiary to its Cypriot ‘mother’ company will generally be exempt from Irish income tax (the standard rule) otherwise levied under Schedule F and from Irish dividend withholding tax by reason of Article 9(1) of the Irish/Cypriot Tax Treaty under the ‘affiliation privilege’. Further, once the 12.5% corporate tax rate has been paid in Ireland no further tax will be payable in Cyprus per S.8 (20) of the Income Tax Law.

Criteria to establish ‘trading’ in Ireland

The existence of a business organisation for the purchase and sale of commodities or the provision of services is indicative of a ‘trade’. Thus, having an administrative centre in Ireland is vital especially if actual clients are contacted, advice given and timesheets monitored etc.
There should be genuine Board Meetings in Ireland, Shareholder Annual General Meetings (AGMs) plus either a resident director or the purchase of an indemnity bond (available through SCF) and the shareholders must be tax resident in a tax treaty or EU member state (can be arranged through SCF)
Repetition of an activity is more likely to be deemed a ‘trade’ if it is an oft repeated and not simply a one off transaction
Added value/modification if there is an added value or modification to a service for client end use then this goes to establish a  trade
One off adventures in passive investments, even if administered, would not suggest a trade

The SCF Management Centre in Wicklow

What SCF can provide

• A fully SCF owned Irish management, administration and conference centre facility within 25 km of Dublin
• 18 years experience of registering and managing Irish companies
• Accommodation for Director and Beneficial Owner visits to IrelandFull accountancy, PAYE, VAT registration and management services
• Indemnity Bonds where no resident directors are required or available
• Company Director and Secretarial Services
• Bank accounts
• Full and Bespoke Management Agreements
• The capability to provide dedicated employees for your Irish business
• Advice not only on how to set up and establish an Irish presence benefiting from the 12.5% corporate tax rate but also on how to avail of the EU Parent/Subsidiary Directive 90/435, various tax treaties ratified by Ireland plus advice on how to benefit from various personal tax concessions available to non-domiciled but resident individuals living in the Republic of Ireland

 

SCF can provide a range of luxury Suites at its Management Centre for visiting directors and beneficial owners

 

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