Since the historic referendum on 23rd June 2016, when the majority of the UK voted to leave the European Union, the English pound fell to its lowest since 1985 and consequently, several companies and financial services said they would leave the UK. The UK has always been considered one of the best countries in which to start a business, but whilst negotiations surrounding the Single Market and Brexit are underway, this could change because of the unknown effects that will be a consequence of Brexit, with many businesses relocating to Ireland.
Whilst it is assumed that Brexit may have adverse effects on the UK’s economy, the Republic of Ireland has seen an influx of UK based service companies choosing to take their business into the country. US companies such as Google, Amazon and Slack are based there, and Dublin’s ever expanding tech sector employs over 100,000 people, and this number is expected to rise. Since 2012, Ireland’s knowledge based economy has created a density of technology and service workers, and combined with the intensity of both competition and collaboration, the irish economy is making a recipe for success – especially in the post Brexit world.
Ireland’s modern knowledge based economy, has made Ireland an ideal place for investment by foreign firms. It is important to mention that as Ireland’s economy is knowledge based, it caters to the needs to of service industries, rather than businesses who mass produce and manufacture large scale goods. Businesses who require large scale workforces for manual labour would find moving their company to Ireland to be expensive, as there are not as many benefits for them. Here are four benefits of moving your service-based business to Ireland.
1. Ireland has a skilled workforce
Ireland’s capital Dublin boasts a highly-educated, skilled and indigenous workforce that attracts top talent from across the globe. Big software companies have been in Dublin for over a decade, therefore creating a talent pool of experience workers and qualified businessmen who know how to grow businesses across EMEA. It is easy to see why these resources are a key attraction for service based businesses looking to move to Ireland – especially since the skilled and qualified workers it boasts comes relatively cheap after the recession.
Alongside this, if you’re looking to develop your business, Dublin has an abundance of knowledge and research facilities that serve the tech industry’s wants and needs. This is because the industry recognised the lack of STEM and language graduates going to Irish universities. It is estimated that over one million people living in Ireland are in full time education, and this is a positive result of the country investing in education, which there for delivers endless results, therefore securing its reputation as an attractive country for businesses to move to.
2. Ireland boasts attractive corporate tax
Ireland has one of the lowest and simplest corporation tax regimes in Europe, and it is easy to follow and it adheres to the OECD guidelines. Ireland’s corporation tax applies to all Irish corporate trading profit and currently stands at 12.5%. What makes this tax regime even more attractive is the Research and Development incentive that was introduced in the 2016 budget. This incentive gives businesses the opportunity to take advantage of the reduced 6.25% tax rate through the new “knowledge box” scheme.
3. Ireland’s economy is growing
The Eurozone has been described as one of the most affluent economies in the world, according to the International Money Fund, and Ireland is a member. Ireland has a small yet highly globalised economy, and is one of the fastest growing economies in Europe due, in part, to a large amount of businesses and individuals investing in Ireland. In 2017 the unemployment rate is at 6.2%, and The Bank of Ireland forecasts a GDP growth of 4.8% this year, after a 5.1% in 2016.
4. Your workers won’t need an employment permit
A major but understated reason to move your business to Ireland before Brexit has been decided is the fact that you won’t need to get work permits or visas. Because England is a member of the EU, UK, EU/EEA they are entitled to work in Ireland without having to apply for an employment permit, and they must be treated in the same way as an Irish Citizen. This means that you will not have to pay for any work visas or permits for any of your workers who are based out of the UK, EU/EEA. Alongside this, both Ireland and the UK are similar countries when it comes to business culture, the regulatory environment, language and laws. When Britain does eventually choose to leave the EU, Ireland will be the only British speaking country left in the European Union.
Ireland is currently being portrayed as the ‘gateway to Europe’, and is a member of both the EU and the OECD. In the UK at the moment, financial services companies have the advantage of passporting, permitting them to market services across the EU from regulation in their home jurisdiction through a freedom of services or freedom of establishment basis. However, once the UK have left the EU, there is a risk of losing these rights, and UK-based companies may have to redomicile investment, establish new operations regulated in an EU jurisdiction and replace UK service providers with EU regulated companies. Ireland’s environment contrasts this, as it remains stable and it is highly unlikely that it will opt out of its EU membership in the future. By moving your business to Ireland, Financial Services firms and software businesses can obtain the certainty needed for continued access to the common market and the use of the EU’s passporting regime.