At Payhawk, we understand the stress of searching for the right business markets. One of the things we learned from our own expansion is that some countries are more straightforward to scale into than others. Ireland is one of them. Additionally, it offers one of the best ecosystems in the world for business enablement.
For example, did you know that Ireland has the highest GDP per capita in Europe, just after Luxembourg? The high GDP is mainly due to the massive exports of pharmaceuticals and IT from multinational corporations. Did you also know that one-third of the population is younger than 25 years old? So a workforce of digital natives is at your fingertips.
But what are the biggest benefits of establishing your business in Ireland?
Low Corporation Tax
Ireland has one of the lowest Corporation Tax regimes globally, with a rate of 12.5%. France has the highest in the EU at 31%, followed by Germany at 30%. The USA, the hub of many startups and scaleups, has a rate of 27%.
Ireland not only has a low corporation tax but is also ranked by PwC as the number one country in Europe when it comes to the ease of paying business taxes.
Intellectual property rights
Irish law is one of the best in regards to protecting intellectual property rights. As Cafico mentions, the provisions in the Irish Trade Marks Act 1996 and the Copyright and Related Rights Act 2000 are widely regarded as best-in-class and even better than many other EU members.
Moreover, the Irish government has also enabled several tax benefits for companies involved in acquiring, developing, and licensing intellectual property (IP).
Research and development
Innovation 2020 is Ireland’s five-year Research and Development strategy, a roadmap for the country to become a Global Innovation Leader, ensuring that locally based companies can outperform competitors in international markets.
The government also introduced a knowledge development box, which means that corporation tax is half the standard rate 6.25%, instead of 12.5%, of eligible company profits in R&D. Finally, Irish companies can also have a Tax Credit of 25% on R&D expenditures executed in Ireland.
Talent acquisition
Ireland has one of the most educated workforces in the world, with 56.3% of 30-34 year olds holding a third level qualification, compared to an EU average of 40.7%. The government is also taking very seriously to have one the best Education systems in Europe, thanks to the implementation of the National Skills Strategy 2025 and an Action Plan for Education.
Brexit relocation
It seems odd to put Brexit on this list of benefits to expand into Ireland. But, due to the UK's uncertain future, many international companies have moved their business to Ireland to continue benefiting from the EU market. Due to Brexit, companies such as Morgan Stanley, TD Securities, S&P Global, Thomson Reuters, Equilend, and Coinbase have already moved to Ireland.
In addition, British citizens can live and work in Ireland thanks to the Common Travel Area arrangement.
Doing business
We mentioned Corporation Tax as one of the main benefits of setting up a business in Ireland. But in regards to opening an entity in Irish land, it’s by far one of the most streamlined processes we've encountered at Payhawk.
When you register as a company in Ireland, it isn't mandatory to have a business bank account. In other European entities, opening a business bank account has been one of the major headaches we've faced as it can involve lots of time, paperwork, and even travel.
In Ireland, you can also establish a company online without being physically present to submit papers or sign incorporation documents.
Download the guide today to discover more about opening in Ireland, including all the key challenges and benefits.
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