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Over the years, the Irish government fiscal policy has undergone some revisions. These changes have positively transformed Ireland from being one of the most backward European countries to become one of the most economically thriving countries in the European Union. Today, Ireland stands as one of the most favorable destinations for international companies who want to set up a holding company in Europe. What makes Ireland very attractive for foreign investors are the low tax rates and it’s generally foreign-friendly legal structure. 

Partnerships are one of the most prefered business legal structures in Ireland. This is because partnerships offer a more flexible and less expensive business structure than other business agreements. The upside to a partnerships is that the partners receive both profits and losses directly and as result they do not face double taxation incured through a corporation. The two most common types of partnerships in Ireland are General Partnership and Limited Partnership. These two partnerships have different terms and conditions and should not be confused.  

The Designated Activity Company (DAC) is one of the most contemporary company types in Ireland. DACs are limited companies in nature and are particularly appropriate for entities who want to set up a unique business model, built upon their specific preferences, unlike in Private Companies Limited by Shares (LTD) whereby the shareholders have unlimited powers. Such entities usually have a detailed description of a clear source of revenue for the business stipulated in their constitution, instead of giving unlimited trading authority, as is the case with most limited companies. As a result, the creed of ‘Ultra Vires’ continues to hold as true in these business entities. DACs keep their Memorandum and Articles of Association as constituent elements of the complete constitution.

Limited companies exist as lawfully separate entities in Ireland. This means that the partners are not entirely responsible for the company’s liabilities. Their degree of liability is determined by the amount of capital that they put in the business. Prospective entrepreneurs looking forward to register their limited liability or unlimited company have a variety of company types to choose from. 

Foreigners who want to expand their businesses in Ireland can choose from two options, either a branch or a subsidiary office. The difference between the two is determined by the degree of independence the establishment can have when discussing in terms of the parent company.