Ireland’s tax system and unique attributes as an investment location encourages both the creation and management of intellectual property (IP). IP has emerged as a central asset of the world’s leading companies. Today, IP is sourced globally through diverse channels such as open innovation, university collaboration, joint venture or direct acquisition.
Ireland provides one of the leading jurisdictions in the world to create IP through research and development, since companies based in Ireland have the ability to reduce their effective corporation tax to as low as 2.5% on income arising from the management, development and exploitation of their IP. This can be achieved by taking advantage of Ireland’s low corporation tax of 12.5%, generous R&D tax credits and competitive onshore IP regime. The new regime allowed for capital allowances to be claimed on IP acquired by an Irish company for the purposes of its trade and was introduced in the Finance Act 2009 in line with the commitment included in the Irish Government’s Economic Recovery Plan, “Building Ireland’s Smart Economy”.
In addition to favourable tax conditions, Ireland also offers the following attributes;
- World class research institutes and university programmes
- No 1 world ranking for availability of skilled labour, flexibility and adaptability of workforce and attitudes towards globalisation, (source IMD World Competitiveness Yearbook 2012)
- A transparent tax regime and commitment to its 12.5% corporation tax
- Special Assignment Relief Programme to attract key talent to Ireland
- Cultural affinity to the US
- Barrier free access to over 500 million consumers in Europe
A wide range of US and other foreign companies have operations in Ireland, including Google, Microsoft, Facebook, Twitter, Accenture, Citi, Intel, HP & IBM. In addition 9 out of the top 10 global pharmaceutical companies, and 11 out of the top 13 global medical technology companies have manufacturing operations in Ireland. The opportunity to collaborate with Irish research facilities, coupled with generous government incentives for research and development has resulted in many companies now choosing Ireland as the location to house their global research and development centres.
airmid healthgroup can assist companies interested in setting up an Irish subsidiary company by connecting them with leading lawyers, tax advisors and IP experts who can investigate the costs and benefits of such an operation.
Further reading:
Research and Development Tax Credit (RDTC)
Intangible Assets Scheme under Section 291A Taxes Consolidation Act 1997
