Why you should Consider an Irish Holding Company
Firstly, why you should consider an Irish Holding company is that Ireland is the EU’s prime location for setting up a holding company. Secondly, over the last few decades, many hugely successful companies such as Apple, Intel, Pfizer, Facebook and Google to name but a few, have set up operations here.
The reasons for all these companies setting up operations here and enjoying successful trading here is clear to see. Ireland as a long-standing member of the EU has a robust trading link throughout Europe and the rest of the world. Our unique relationship with the United States has been the catalyst for significant foreign direct investment.
As I mentioned so many companies have settled on our shores. So, of the top 20 global tech firms, 16 have their European headquarters in Ireland. Of the top 25 biotech and pharma companies, an astonishing 24 of which chose Ireland as the destination. On top of global industry giants setting up in Ireland, we have over 1200 multinational’s taking advantage of the ease of access to EU markets that Ireland has and Ireland’s business culture.
So, with all this in mind. Here is why you should consider an Irish holding company.
Business Culture
Ireland is viewed the world over as a leading business environment. Our political stability and the elements that make up our regulatory regime are key to this. Also, if you’re not a fan of bureaucracy, Ireland is considered low in this regard. This is thanks to bodies like the IDA and Enterprise Ireland who provide excellent support to entrepreneurs.
The plaudits for Ireland’s business culture keep on coming with the World Bank’s “Doing Business” report labelling Ireland as the easiest place to start a business in the EU. This report also mentions that in Europe or the Americas, that our tax regime is the most business-friendly.
Ireland’s corporate Tax Regime
So what’s the incentive to set up a business in Ireland? Our corporate tax regime is ours. Our corporate tax is 12.5% and when you couple that with our international double tax agreements. What is left is a fantastic fiscal platform for a holding company.
Ireland has double tax treaties with the like of Australia, Canada, US, China as well as the OECD countries and of course all EU member states. Under these agreements, direct taxes are covered, and Ireland’s case are:
- Universal Social Charge
- Income Tax
- Corporation Tax
- Capital Gains Tax.
A few other things you should know and why you should consider an Irish Holding company.
- There is a remittance taxation system in place for non-domiciled Irish resident individuals. This allows a tax incentive to locate in Ireland for foreign individuals.
- There are no controlled foreign corporation rules
- The transfer pricing legislation is limited
- And, there is no dividend withholding tax on payments made to individual shareholders that reside in either an EU or double tax treaty country.
Develop your ideas securely
If your company is involved in Research and Development, your company can avail of a corporation tax rate of 6.25% under the Knowledge Development Box (KBD) scheme.
So what this means is that long term certainty is provided to industries planning their research and development investments in Ireland. This scheme also lends itself to strengthening Ireland’s high standing as a country for protection of Intellectual property.
This standing has led to Ireland being one of the biggest exporters of IP in the world. Holding companies involved in R&D activities in Ireland have benefited from a tax credit of 25% on expenditure.
Our reputation, as a common law jurisdiction, is safe and a stable place from a political point of view to hold IP rights. This backed up by a robust court system that strongly protects the owner’s intellectual property rights. This also covers patents, trademarks, copyright and design.
Workforce
Another reason why you should Consider an Irish Holding Company. Is the high skilled and educated workforce at your disposal in Ireland. Approximately 52% of people between the ages of 25-34 have a 3rd level qualification. To put that in perspective an OECD average is 43%.
It’s our highly skilled workforce along with other factors that are important factors for companies considering setting up in Ireland.
Brexit
So, it just seems to keep lingering, doesn’t it? As it edges ever closer many UK companies are looking to protect their interests from Brexit.
Barclays has shifted ownership of it’s French, Spanish and German branches to its Irish entity. It looks like they will move all its EU based entities to an Irish holding company. Other companies are at this moment looking to do the same and this is a big endorsement for Ireland and as a hub to do business.
By setting up a holding company in Ireland before Brexit it will allow them to adapt more seamlessly to any post-Brexit policies or regulation changes but also open new opportunities.
And less we forget
- Low capital startup costs
- EU Membership and proximity to those markets
- Growing Economy
- Supportive state agencies
- No ‘Thin Capitalization rules’ or ‘Controlled Foreign Company’
- Being able to combine your trading activities with its holding company function.
It’s easy to see why Ireland is an attractive place to set up a business and to do business. That’s why you should Consider an Irish Holding Company. Finally, for more details contact us today on enquiries@citytrust.ie or call 01-6753140
