Are you a foreign based individual looking to set up a limited company in Ireland? Here are a few things you need to consider before you get started.
We have received many enquiries over the years from different parts of the world. If a mark was made on a globe for each one, we would have coverage in every continent and many of the countries within.
Many of these ‘enquirers’ have become our valued clients and its reassuring to see the continued level of overseas interest in doing business in Ireland.
Ireland does have many benefits, some well publicised before, during & after the IMF/EU deal and others not so well known. (Click here to read about the advantages of setting up a limited company in Ireland.)
Having a low headline corporate tax rate is always a big pulling factor, and when you think that Ireland has so far maintained this rate even in such an adverse environment & continued political pressure, it is a significant achievement.
With recent threats to Cyprus's lower 10% corporate tax rate being passed about in the headlines following their IMF bailout, then that would seem to strengthen Ireland’s position.
A common assumption made by some members of the international business community is that our low corporate tax rate, plus other common benefits that go with operating an Irish registered company, are available to ALL and EVERY Irish registered company - WRONG!
Our 12.5% Corporate Tax Rate applies to the trading income of the Irish registered entity and on the basis that the control of the company is effected from Ireland.
Trading income is the core income generated from the company’s core business activity and excludes passive non-trading income arising from investments.
More importantly it does not apply to ‘foreign trades’ and these would normally be trading controlled wholly from outside Ireland.
To structure your company in the desired way so that you can avail of Ireland’s tax benefits you will need to consider one or more or a combination of many issues, including:
- Where do the company directors reside?
- Are there local Irish employees?
- Where is the company bank account held?
- Where are the board meetings held?
- Where are the company’s customers & suppliers based?
- Where are the company’s business premises?