How to qualify for 12.5% Corporation Tax in Ireland

Compared to other countries in Europe, Ireland's corporation tax is fairly low. While in most countries corporation tax subsidies stand at a staggering 20%,  Ireland boasts of a subdued figure which is just 12.5% of the revenue of the entity.
Corporation tax applies to all Irish companies. It refers to a tax subsidy that every firm, business and or entity incorporated under the act is required to comply with. Every entity whose tax levies have been submitted in Ireland is required to comply with the corporation tax, which is a relative percentage of the firm's gross revenue for all its business operations in the world.
It is very important to ascertain which category of corporation tax an entity falls under. Entities who obtain their revenue gains from product sales and service delivery in Ireland qualify for the 12.5% corporation tax rate. This tax levy also applies to non-Irish resident businesses who run quantifiable business operations in the country.
Every Irish entity qualifies for the 12.5% tax levy and is required to provide substantial information about how their business is run and controlled. It’s not mandatory for all bank accounts owned by the entity to have an Irish origin. The key to accessing the 12.5% tax rate is providing substantial evidence that your entity is an Irish resident. Hence information regarding day to day operations of the business is very credible and essential.
To assess the credibility of any claim made by an entity about their residence in Ireland, the revenue will go through any substantial evidence provided by the firm. Such information will include however not limited to:

  • Information relating to the decision-making headquarters, evidence of all investment decisions being made in Ireland.
  • Residential addresses of all key personnel who make decisions in the firm such as directors are required to determine whether such named persons reside and oversee business activities in Ireland. It is also important to avail all residential addresses for employees who participate in the day to day running of the business.
  • Sufficient evidence of intra-trading records with other Irish companies should be provided in order to ascertain whether a business has substantive operations in Ireland. 
  • All corporate meetings from operations level to the strategic level meetings should include exclusively the venue which should coincide with any addresses in Ireland
  • All documentation concerning all assets and properties owned by the company present in Ireland should be provided. All property rental invoices showing extensive activity in Ireland should also be provided as these also provide sufficient evidence of whether a firm is an Ireland resident entity. 

Start-up companies in Ireland are liable to corporation tax exemption. Eligible entities should be incorporated before or on the 14th of October 2008. The firm should have pending or due tax levy subsidies that do not exceed the set figure. It should be noted that this tax waiver is eligible for companies with employees.  
For more details and assistance regarding corporation tax in Ireland, you can reach out to our expert consultants. Our highly experienced and well-informed team is ready to answer all your questions and give you all the help you might need.


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