Ireland company registration

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Ireland company registration

DOING BUSINESS IN IRELAND IN 2017


Since 2003, Healy Consultants Group PLC has been efficiently and effectively assisting our Clients with i) Irish business registration ii) business licensing iii) Irish business banking solutions iv) visa options and staff recruitment strategies and v) tax planning solutions.

SummaryTax Resident LLCTax exempt LLCHolding companyIFSC LLCPLCLLPRepresentative office
Best use of company?All products and servicesAll products and servicesManage global subsidiariesFinancial servicesPublic listingProfessional servicesMarketing & research
How soon can you invoice Clients/sign sales contracts?2 weeks2 weeks2 weeks3 months2 weeks2 weeks2 weeks
How soon can you hire staff?2 weeks2 weeks2 weeks2 weeks2 weeks2 weeks2 weeks
How long to supply corporate bank account numbers?1 month1 month1 month1 month1 month1 month1 month
How long to supply company registration/tax numbers?2 weeks2 weeks2 weeks2 weeks2 weeks2 weeks2 weeks
Corporate tax rate on annual trading profits?12.5%0%12.5%12.5%12.5%0%0%
Corporate tax rate on annual non-trading profits?25%25%25%25%25%0%0%

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Effective corporate tax rate on net profits of €500,000?4.5%0%0%4.5%4.5%0%0%
Limited liability entity?YesYesYesYesYesYesNo
Minimum paid up share capital? (EUR)1111250001None
Recommended paid-up capital?111Depends on License250001None
Corporate bank account location?Barclays IrelandUnicredit IrelandAIBSCB BankBank of IrelandUlster Bank IrelandHSBC
Can secure trade finance?YesYesYesYesYesYesNo
VAT payable on sales to local customers?up to 23%up to 23%up to 23%Noup to 23%up to 23%No sales allowed
Average total business set up engagement costs? (EUR)7,2557,2556,255TBC9,1058,1057,210
Average total engagement period?2 months2 months2 months2 months2 months2 months2 months
Accounting and tax considerationsTax Resident LLCTax exempt LLCHolding companyIFSC LLCPLCLLPRepresentative office
Statutory corporate tax rate on annual trading profits?12.5%0%12.5%12.5%12.5%0%0%
Statutory corporate tax rate on annual non-trading profits?25%25%25%25%25%0%0%
Legally corporate tax exempt if properly structured? NoYesNoNoNoYesNo
Group HQ tax incentives?YesYesYesYesYesYesNo
Must file an annual tax return?YesYesYesYesYesNoYes
Must file annual audited reports?YesYesYesYesYesNoYes
Must appoint an auditor?NoNoNoNoYesNoNo
Access to double taxation treaties?YesYesYesYesYesYesYes
Company registrationTax Resident LLCTax exempt LLCHolding companyIFSC LLCPLCLLPRepresentative office
Minimum number of shareholders/partners?111172Parent company
Minimum statutory paid up share capital? (EUR)111125,0001None
Minimum number of directors/managers?1111221
Must sign an physical office lease agreement during incorporation?NoNoNoNoYesNoNo
Shelf companies available?YesYesYesYesNoNoNo
Time to incorporate a new entity?2 weeks2 weeks2 weeks2 weeks2 weeks2 weeks2 weeks
Can easily convert to a PLC?YesYesYesYesYesNoNo
Can have preference shareholders/partners?YesYesYesYesYesYesNo
Business considerationsTax Resident LLCTax exempt LLCHolding companyIFSC LLCPLCLLPRepresentative office
Regulatory license usually required?NoNoNoYesNoNoNo
Good entity for trademark registration?YesYesYesYesYesYesNo
Can secure an import and export license?YesYesYesYesYesNoNo

Resident director/partner/manager/legal representative required?Yes
Sponsorship by a local citizen required?No
Our Client needs to travel to Ireland for business set up?No
Temporary physical office solutions available?Yes
You need a local resident as bank signatory?No
Can be wholly foreign owned?Yes
Resident director/partner/manager/legal rep. required?Yes
The entity will likely be regulated by?CRO
Foreign non resident director needs a residence visa?No
How soon can you sign a lease agreement?1 week
Withholding tax on payments to foreign shareholders?up to 20%
Monthly VAT reporting to the Government?Yes
Public register of shareholders and directors?Yes
Government approval required for foreign owners?Yes
Corporate documents to be attested/translated?No
Can bid for Government contracts?Yes
Each foreign director needs a personal income tax number?No
Foreign non resident director needs a residence visa?No
Maximum number of staff allowed?None
Maximum number of staff allowed?None
Can secure residence visa for business owner?Yes
Other useful information
What will be included in my customer sales invoice?Available template
This country has signed free trade agreements?72
This country is a member of WIPO/TRIPS?Yes
This country is a member of the ICSID?Yes
Average custom duties suffered?0.6%
Government foreign investment approval required?No
Maximum shareholding for foreigners?100%
Average monthly office rental? (EUR per sq m)50
Minimum statutory monthly salary? (EUR)1,376
Average monthly salary for local skilled employees? (EUR)2,500
Security deposit to be kept with Government?No
EUR deposit interest rate? (1 year average)0.25%
Overseas remittance currency controls?No
Banking considerations
Multi-currency bank accounts available?Yes
Corporate visa debit cards available?Yes
Quality of e-banking platform?Yes
Crowd funding available in this country?Yes

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  • Advantages of Ireland business set up

    Advantages of Ireland business set up

    Ireland business registration advantage

    1. Ireland resident companies of all sizes enjoy the following tax incentives:
      • The Ireland corporation tax rate is 12.5%, the second lowest in the EEA after Bulgaria. It is possible to further reduce the annual tax bill by up to 25% by deducting R&D costs;
      • For the 1st year of business, trading profits can be reduced by expenditure incurred in the three years prior to the commencement of trade. Furthermore, for the first 3 years, annual income up to €320,000 is legally tax exempt;
      • There is no withholding tax for Irish companies on outbound payments to 72 double taxation signatory countries and the EU including dividends, interest and royalties. Also, there is a capital gains tax exemption on disposal of international subsidiaries;
      • An Irish LLC is exempt from VAT, if at least 75% of sales turnover arises from the export of goods;
      • Irish SMEs are not subject to i) annual audit (if the group has annual turnover less than €8 million and hires less than 50 employees) and ii) transfer pricing provisions;
      • The Irish Tax Authorities welcome email and phone communication from business owners. Tax officers are helpful providing timely written advance tax rulings and clarifications regarding tax laws.
    2. Irish companies may also receive following cash benefits from the Government:
      • An Irish LLC receives a cash grants of €10,000 for each staff member hired from the long term unemployed pool. Free re-training and re-skilling courses for these employees;
      • An Irish LLC receives an annual cash grant of €10,748 for each employee with a disability;
      • The remuneration of part-time employees is paid by the Irish Government, not the employer.
    3. Large MNCs doing business in Ireland through a subsidiary enjoy countless benefits including:
      • An effective corporation tax rate of 0%, usually after Group relief. Also, if the Irish company is properly structured, investment income including i) subsidiary dividends ii) interest, royalty and patent income and iii) foreign branch profits is legally tax exempt;
      • Access to i) low cost Government owned industrial parks with purpose-built factories and ii) low cost greenfield sites for industrial usage. Investors can custom-build factories without the need for local planning permission;
      • Excellent Group relief incentives including i) exemption from filing consolidated tax returns ii) inter-company transfer of trading losses, excess management expenses and excess capital allowances;
      • Stamp duty relief is available for transfers arising from corporate reorganisations and reconstructions;
      • Trading losses may be i) carried forward indefinitely against future trading profits ii) carried back for one year or iii) allocated within Group companies or iv) offset against capital gains tax liabilities;
      • Lastly, MNCs will also likely benefit as there are no ‘Controlled Foreign Company (CFC)’ and ‘Thin Capitalization rules’ in Ireland. Furthermore, there is a limited transfer pricing legislation for large multi-national companies registered in Ireland.
    4. Foreign employees relocating to Irish companies enjoy low Irish income tax because:
      • 30% of remuneration in excess of €75,000 is exempt from income tax;
      • No benefit-in-kind income tax on i) employee family flights home ii) annual school fees iii) employee accommodation and subsistence costs and iv) employee stock options;
      • Employees can secure personal income tax relief on investments of up to €150,000 per annum in qualifying companies;
      • An Irish LLC is allowed to offset R&D credits against the income tax of senior R&D employees;
      • Employees of an Irish LLC enjoy an annual income tax reduction of €14,000, if they spend at least 40 days per annum working in an emerging market;
      • Business travellers can work in Ireland for two months without suffering income tax.
    5. Registering a company in Ireland provides a gateway to the EEA, the largest consumer market in the world. Specifically:
      • Ireland’s currency is the euro and will be the only English speaking member of the EU after the Brexit;
      • Sale of goods to customers within the EU are VAT free, but VAT is payable in the other member State;
      • An Irish LLC enjoys customs duty-free importation of goods from other EU countries;
      • Irish employees can easily move within the European Union to work and live.
    6. Multi-national companies starting a business in Ireland enjoy access to a large pool of quality skilled labour because:
      • Labour cost per hour is €29, one of the lowest in the EU. Employers are not legally required to provide their employees with pensions or other benefits such as health care;
      • Labour productivity per person in Irelands is the third highest in the EU;
      • Ireland has the youngest population in Europe, 55% under the age of 35. The young workforce has shown a particular aptitude for the efficient collection, interpretation and dissemination of research information;
      • Currently, 1 million people are in full time education in Ireland. In 2016, approximately 48% of 25 – 34 year olds are third level qualified;
      • Approximately 520,000 Irish residents speak a foreign language including Polish, French, Lithuanian, German, Russian, Spanish and Romanian;
      • European Economic Area (EEA) nationals and Swiss nationals are allowed work in Ireland without a work permit or visa.
    7. Ireland is a technology hub in Europe because:
      • An Irish LLC, which qualifies for the OECD compliant knowledge development box, only suffers corporation tax of 6.25%;
      • Ireland is a rich source of highly skilled talent in science, technology and engineering. As a result, the country is the largest exporter of software in the world;
      • Annual net profits enjoy an expense deduction for the cost of IP amortised over a 15 year period;
      • The Government offers a portfolio of Business & Technology Parks in strategic locations. Furthermore, the country has a vibrant business angel and venture capital environment;
      • The close link between multi-national companies and Irish universities encourages leading-edge research.
    8. Ireland does not impose corporate income tax and capital gains tax on hedge funds. As a result, Ireland is home to 40% of global hedge funds, which cumulatively account for €1.9 trillion in assets;
    9. By establishing a non-resident Irish LLC, our Client’s companies will be tax exempt in the country:
      • A company is regarded as non-resident if i) no business is done in Ireland ii) if the majority of shareholders and directors reside overseas iii) the entity neither has staff nor premises nor a corporate bank account in Ireland;
      • An international tax haven company is allowed to migrate the entity to Ireland. This is attractive to Clients who wish to abandon the use of tax haven companies, choosing instead to trade through reputable low tax entities like an Irish LLC. For example, a BVI entity can elect to be an Irish resident or non-resident Irish company, keeping the same name and international corporate bank account. The BVI LLC will thereafter no longer exist.

    Disadvantages to Irish business set up

    1. An Ireland registered company suffers Irish VAT on imported goods and services, ranging from 0% to 23%. Goods imported into Ireland from outside the EU suffer customs duties;
    2. An Ireland registered company also suffers 25% corporation tax on annual net profits arising from passive income including i) local rents ii) local investment income or iii) income from oil, gas and mineral exploitations. A properly structured Irish LLC receiving international investment income enjoys the lower rate of 12.5%;
    3. A small tax resident Irish LLC suffers a surcharge of 20% on the undistributed investment and rental income. Professional services companies suffer a surcharge of 7.5% on undistributed trading income. Healy Consultants helps our Client legally eliminate this tax;
    4. Unfortunately, Irish parent and subsidiary companies must submit annual financial statements to independent statutory audit; regardless of sales income levels.
    5. Both resident director and company secretary are required for company incorporation:
      • Irish companies must either appoint one Director that is resident in Ireland or other EEA countries, or deposit a bond of €25,000 with the Irish Business Registrar;
      • Company secretary can either be one of the company’s director or a second body corporate. Single-director companies must appoint separate secretaries.
    6. The employer employee relationship is complicated by:
      • An 11% mandatory Government employer PRSI contribution;
      • The existence of powerful industrial unions;
      • The obligation to pay compensation to employees dismissed for reasons of redundancy;
      • Employees frequently force employers to attend Employment Appeals Tribunals re unfair dismissals;
      • In addition to income tax, employees of Irish companies suffer a punitive unpopular Universal Social Charge of 7% of gross remuneration.
      • The maximum average work week is 48 hours; however, in the collective agreements, the week is often reduced to 39 hours;
      • Also, included in the collective agreements will be the rates of overtime pay; for example, the current registered employment agreement for the construction industry provides for overtime rates of pay of time-and-a-half until midnight Monday to Friday and double time thereafter.
  • Best uses for an Irish company

    • Ireland is a popular choice for technologies multinational companies that wish expand their operations in Europe, because:
      • Ireland has the second lowest corporate rate in the region;
      • They can take advantage of the knowledge development box, and lower their corporate tax;
      • Access to a big pool of highly skilled and English-speaking employees;
      • Opportunities to collaborate with top universities and education centres in the country;
      • Lower cost of living, when compared to other major European cities;
      • Ireland is the key technology hub in Europe. Some examples of companies that set up European headquarters in Ireland include Apple, Facebook, Paypal and Microsoft.

Healy Consultants’ video on registering a business in Ireland

Contact us

For additional information on our business registration services in Ireland, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Mr. Petar Chakarov, directly:
client relationship officer - Petar
Ireland department of foreign affairs and trade Dublin chamber of commerce Central bank of Ireland Chambers Ireland - in business for business Chartered accountants Ireland Ireland companies registration office IFSC Ireland Immigrant council of Ireland Irish naturalisation and immigration service - department of justice and equality Inter trade Ireland - cross border business development and business support Ireland department of finance