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ACC International Legal Affairs Committee Legal Quick Hit Corporate Migration:

ACC International Legal Affairs Committee Legal Quick Hit Corporate Migration: Why Are So Many Companies Choosing Ireland? Presented by Ailish Finnerty (Tax Partner) Arthur Cox - Ireland May 13, 2010. Why Corporate Migration?. Perceived US tax policy shift against off-shore tax havens

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ACC International Legal Affairs Committee Legal Quick Hit Corporate Migration:

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  1. ACC International Legal Affairs Committee Legal Quick Hit Corporate Migration: Why Are So Many Companies Choosing Ireland? Presented by Ailish Finnerty (Tax Partner) Arthur Cox - Ireland May 13, 2010

  2. Why Corporate Migration? • Perceived US tax policy shift against off-shore tax havens • Move towards top holding company in tax treaty jurisdiction

  3. Why Ireland • Low corporate tax rate (12.5%) on trading profits and trading dividends • EU member, euro (€) zone member and English speaking • Extensive double tax treaty network • Common law jurisdiction similar to the USA • Generous incentives available for investment • Highly developed legal, tax, economic and financial infrastructure and well-educated labour force

  4. Effecting the Migration • Incorporate a new parent company in Ireland • Share for share exchange • Cancellation scheme of arrangement • Merge an EEA company into an Irish company • Convert an EU company into a Societas European (S.E.) and move its corporate seat to Ireland • Migrate the tax residence of an existing company to Ireland

  5. Tax Issues - Residence • General Test – Central Management and Control in Ireland • Board of Directors • Strategic Decision-Making

  6. Tax Issues - Dividends • Payment by Irish Resident Company • Dividend Withholding Tax @ 20% • Various Exemptions • EU/DTT residents & not under control of persons not so resident or shares in recipient/parent traded on SE in EU/DTT • Income Access Shares • ADR exemption • Receipt by Irish Resident Company • Taxable @ 25% or @ 12½% if trading dividends with credit for withholding tax / underlying tax

  7. Other Tax Issues • Stamp duty on share transfers of 1% • ADR exemption • No thin capitalisation rules • No controlled foreign corporation / sub-part F rules • Generally no capital gains tax on sale of shares by non-resident (and exemption for disposal of 5%+ shares in a company part of a trading group and resident in EU/DTT) • Limited transfer pricing rules

  8. Conclusion • Migrated HQ to Ireland - Accenture - Cooper Industries - Covidien - Ingersoll-Rand • Warner-Chilcott - Willis • James Hardie - TBS Shipping • Charter plc - Shire Pharmaceuticals • Experian

  9. For further details, please contact:Ailish FinnertyPartner, Arthur CoxTelephone: + 353 1 618 0561(direct)Fax: +353 1 618 0775Email: Ailish.Finnerty@arthurcox.com

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