TKEG Expat ™ Ireland Corporate Tax Guide

Standard Corporate Income Tax Rate: 12.5% (trading rate) / 25% (passive rate) / Capital gains tax rate: 33%. Worldwide profits of businesses that are resident in Ireland are taxable in Ireland. Non-resident companies are only subject to Irish corporation tax on the trading profits of an Irish branch or agency, while certain Irish-source income (usually subject to withholding tax) is subject to Irish income tax. Passive income, including dividends, interest, rents and royalties from companies that are tax resident outside of Ireland, is taxed at 25%. The law provides for a 12.5% tax on certain dividend income, such as foreign trade income. The higher tax rate (25%) also applies to businesses operating entirely outside Ireland, as well as land trading, mining and petroleum extraction businesses. Close companies may be subject to additional corporation tax on undistributed investment income (including Irish dividends) and undistributed income from professional services (lawyers, accountants, doctors, engineers, etc.).

Ireland VAT Overview: The standard VAT rate is 23%. Reduced rates of 13.5% and 9% apply to certain goods and services. The 13.5% rate applies to construction services, labour-intensive services, household fuels and electricity. The 9% rate applies to tourism-related services, newspapers and sports facilities. Exports, most basic foodstuffs, oral medicines, books, children's clothing and footwear are subject to the zero rate. Certain supplies are exempt from VAT, including most banking services, insurance, medical care, passenger transport, education and training, and the letting of immovable property.

Payroll Tax: The Pay-As-You-Earn system (PAYE system) places an obligation on employers to deduct income tax, Universal Social Charge (USC) and pay-related social insurance (PRSI) from payments made to employees, and to remit such deductions to the Irish tax authorities.

Pay-related Social Insurance (PRSI): Employees are compulsorily insured under a state-administered PRSI scheme. Contributions are made by both employer and employee. Employer PRSI contributions apply at rates up to 11.25% (increased from 11.15% since 1 October 2025), and these are an allowable deduction for corporation tax purposes.

Overview of import and export taxes: Ireland is part of the customs territory of the European Union. Goods imported into Ireland from countries outside the European Union, including the United Kingdom, are subject to customs duties at the appropriate rates specified in the EU's Combined Nomenclature Tariff. Rates vary from 0% to 14% for industrial goods, with higher rates for agricultural products.

Goods imported from other EU member states (intra-Community movements) do not incur customs duties, provided the products are in free circulation in another EU member state. Excise duties are not charged on the export or sale of excisable goods to other EU member states, provided the products are circulating within the EU.

Stamp duty is a tax on instruments. It is payable on transfers of land and on other assets where legal title cannot be passed by delivery. It is chargeable on instruments of transfer executed in Ireland and on instruments, wherever executed, that relate to Irish property or relate to matters done or to be done in Ireland.

Stamp duty on the transfer of assets between associated companies may be fully relieved from stamp duty, provided the following key conditions are met:
- The companies have a 90% relationship (one company is, directly or indirectly, the beneficial owner of at least 90% of the ordinary share capital of the other, and is entitled to at least 90% of the profits available for distribution and at least 90% of the assets in the case of a winding-up, or a third company has these rights in respect of both companies).
- This relationship is maintained for a period of at least two years after the transfer of the assets (to prevent the relief being clawed back). There are certain limited exceptions to this two-year association requirement.