
A
holding company in Ireland is registered for the sole purpose of
owning and managing other legal entities.
Ireland has become an attractive business destination for the
registration of holding companies due to numerous
tax advantages and
tax exemptions (for example, this
type of company can benefit from a
capital gains participation exemption).
Businessmen who want to
open a company in Ireland as a
holding company should also know that this
business structure is
exempted from the payment of the
withholding tax on dividends and it can also benefit from the
provisions of the double taxation treaties signed by this country.
Our team of local consultants can offer advice on the
tax benefits applicable to a
holding company.
Taxation system applicable to Irish holding companies - explained by our experts in company formation in Ireland
Once a
holding company is established in
Ireland, it will become
liable to taxation, as it is the case of any other
business form registered in this country. One of the
taxes applicable to a
holding company is the
corporate income tax, which is imposed at the
standard rate of 12,5%. Our
Irish company formation consultants present below the other
taxes applicable to a
holding company:
-
• the passive income of a holding company is taxed at the standard rate of 25%;
-
• in the situation in which the company does not qualify for a tax exemption on the capital gains, it will be taxed at the standard rate of 33%;
-
• the capital gains tax is not applicable if the holding company holds directly or indirectly minimum 5% of the ordinary share capital for a period of at least one year;
-
• a holding company that has disposable shares has to be a tax resident in one of the countries with which Ireland signed a treaty for the avoidance of double taxation.
How is the corporate income tax applied to Irish holding companies?
However, certain
foreign dividends can be imposed with a
corporate tax of 25%, but
tax exemptions can be applied in this case as well, under the
Irish tax credit pooling system. Investors are invited to
contact our team of specialists in Irish company formation for more details concerning this rule.