In June 2016, a historic referendum took place and the majority of the UK voted to leave the European Union. Since then, we’ve seen the value of the pound plummet to its lowest value since 1985, and what could happen after the international diplomacy and treaty negotiations are still unknown.
At the moment, the UK are in the process of renegotiating the treaties with the EU Block. These negotiations could take between two to four years, due to the delays of opening Article 50. The European Union operate on the basis of a complex set of more than 120 bilateral policy agreements. During the negotiation process the UK must still comply with EU laws and participate in other EU business, however, the UK cannot participate in internal EU discussions or decisions regarding their own withdrawal.
These discussions will focus on negotiating access to the single market and new trade deals, and a priority for international businesses is to decrease and eliminate risk and uncertainty. Many UK-based businesses are considering relocating their business to Ireland, as a first step when it comes to reducing that uncertainty.
Ireland boasts a modern knowledge based economy, making it a great place for investment by foreign firms. It is important to mention that companies requiring large scale workforces for manual labour would not be cost-effective as Ireland’s minimum wage is 10% higher than the UK’s (Paycheck Plus), and shipping can also be costly, although these costs can be offset through trade finance measures and ensuring that you hedge against FX risks when you transfer money to Ireland from the UK.
Benefits of moving your business to Ireland
Doing business in the UK and Ireland boasts similarities, and there are many benefits of moving your business to Ireland. These include:
- 12.5% Corporation tax rate
- Stamp duty exemption for Intellectual Property
- R&D Development Benefits
- Capital allowances
Before your business’s registration can be completed, you will need proof of identity, such as a passport, and two documents showing proof of address for the directors and shareholders of the new company – this can be: bank statements, utility bills, tax documents.
There are many elements you must consider when it comes to moving your business to Ireland, and Company Law in both the UK and Ireland are very similar. A UK or international business looking to move from the UK to Ireland needs to contemplate the following:
Directors, secretaries and PSCs
For anyone looking to register their business in Ireland, Irish company registration requires one director and a separate person acting as Company Secretary. Should the business be a single director company, a different person has to act in the role of the Company Secretary.
If you wish to relocate and register your company to Ireland, you need register any people with significant control (also known as a PSC). A person with significant control is a person or registrable legal entity who meets one or more of the following in relation to a company:
- A person owns more than 25% of the company’s shares
- The person holds more than 25% of the company’s voting rights
- The entity holds the right to appoint or remove the majority of directors
- The person has the right to, or actually exercises significant influence or control
- The entity holds the right to exercise or actually exercises significant control over a trust or company that meets any of the other 4 conditions.
Registering a person or entity with significant control does not apply to Irish businesses.
Reserving a company name
Should you decide to move your business to Ireland, you have the opportunity to reserve for a period up to 28 days – this is not possible in the UK.
Employment permits for EU/EEA workers
If you’re choosing to move your business to Ireland before Brexit has been decided, you do not need to get work permits or visas for any EU/EEA workers . At the moment, Britain is a member of the EU which means that EU/EEA are entitled to work in Ireland for three months without having to apply for an employment permit, and they must be treated in the same way as an Irish Citizen. Family members also have the right to reside in Ireland.
This is massively advantageous as it means you do not have to pay for any work visas or permits for any of your workers who are based out of the UK, EU/EEA, and integrating into Irish worklife will not be as challenging because both Ireland and the UK are similar countries when it comes to business culture, the regulatory environment, language and laws. If you are a UK citizen, then you can live in Ireland without any without any conditions or restrictions.
However, if you’re a national of the EEA or of Switzerland, you can stay in Ireland for up to three months without restriction. Should your employees choose to stay in Ireland after that, they must:
- Be employed or self employed,
- Have sufficient resources and sickness insurance, ensuring that they don’t become a burden on the social services of Ireland or
- Be enrolled as a student or vocational trainee or
- Be a family member of a EU citizen in one of the previous categories.
Registering an Irish address
When you move your business to Ireland, you must register your company with an Irish address. Ireland does not permit P.O box addresses. However, this registered address does not need to be your trading address.
No maximum limit on share capital
For a limited (LTD) company, the minimum issued share capital is €1. Authorised and issued share capital has the option to be selected at the point of incorporation based on your preference.
There is no maximum limit to the share capital requirement in Ireland, but public limited liability companies are required to deposit a minimum share capital of approximately €25,000. 25% of this must be paid before commencing any commercial activity
Filing an annual return
All registered Irish companies are obliged to file an annual return with the Companies Office at every calendar year. Businesses have to attach a copy of their accounts to the annual return filed with the Companies Registration Office – with the exception of the Company’s first Annual Return. The accounts the business attaches to the annual return must up to a date – no more than nine months earlier than the effective date of the return.