Over the past number of years Ireland has established itself as an investment destination of choice for many multinational companies, which is not surprising given Ireland’s pro-business environment. In our recent blog, Ireland Continues To Attract Foreign Direct Investment (FDI), we reviewed some of the of the contributing factors to Ireland’s growing FDI investment.
Why do world leaders choose Ireland?
While our attractive tax regime is well publicised throughout the world, Ireland has much more to offer than just tax! On a global scale Ireland scores highly in many of the key areas of importance for companies looking to invest, which is why Ireland has become the headquarters for many Multinational Companies (MNC’s).
From our experience of working with both our international business partners and clients we have gained a detailed understanding of what is required to meet the needs of those companies looking to invest in Ireland and have highlighted some of the key factors below:
Reasons To Do Business In Ireland
Availability of Skilled Labour
Ireland has a young, flexible, adaptable and mobile workforce. Ireland has always been regarded as a centre of excellence for education.
Low Corporation Tax Rate
Ireland 12.5% Corporate Tax Rate on trading income is one of the lowest “onshore” statutory Corporate Tax Rates in the world. It is important to note that Ireland’s Corporate Tax Rate is not an incentive regime, as it is the standard tax rate applicable to active business from any industry or sector.
Reliefs available to staff assigned from abroad
One of the key reliefs for staff assigned from abroad is the Special Assignee Relief Programme (SARP). SARP provides relief from income tax on part of the income earned by employees who are assigned to work in Ireland. This can be an important factor for companies when initially establishing a base in Ireland as it facilitates key personnel in making the move to Ireland.
Research and Development Tax Credit
In Ireland a company can avail of a 25% tax credit against their current year corporation tax liability. The credit available is available to those companies engaged in in-house qualifying research and development activities, including plant, machinery and buildings.
Attractive Holding Company Regime
Ireland’s attractive tax, regulatory and legal regimes, combined with an open and accommodating business environment has established it as a world class location for the headquarters of many international companies.
Ireland has a rich history of achievements in science and technology and continues to invest in research and technological capabilities. The most recent example of how Ireland is a continuing centre of excellence for technology is reflected through the investment by many of the large technological companies in the development of data centres within Ireland. Apple recently announced an €850 million development of a data centre in Co. Galway.
Ireland is one of the only two English Speaking members of the Euro zone, which is an important consideration for companies establishing a base in Europe.
Good track Record
Over 1,000 multinational corporations are continuing to expand their facilities in Ireland due to the profitability and success of their Irish operations. Ireland also offers companies a barrier-free access to over 500 million consumers within Europe.
What others say about Ireland as a place to do business
In addition to the above factor, Ireland continues to perform well in many global surveys:
- 1st in the world for availability of skilled labour, flexibility and adaptability of workforce, attitude towards globalisation and investment incentives. (The IMD World Competitiveness Yearbook 2014)
- Ranked lowest in the world in having difficulty in filling jobs at just 2%. (Manpower’s 2014 Talent Shortage Survey)
- Dublin – best city in the world for human capital (EIU Benchmarking Global City competitiveness Report 2012)
- 2nd “most free” economy in the Euro-Zone, (Heritage Foundation).
- Ranked 1st globally for the value of investment projects to the economy and 4th in the world for inward job creation from inward investment, relative to population. (2014 IBM Global Locations Trends Report)
- In 2014 Ireland was the only one of the top 10 countries in Europe to record a growth in Foreign Direct Investment projects. (Foreign Direct Intelligence)
- Ireland stands in the top 15 of easiest places in the world to do business (World Bank Doing Business 2015)
Why Choose Ireland.
It is clear from the above that Ireland has many factors, besides tax, which have lead to our country becoming a destination of choice for Foreign Direct Investment. From our experience of working with our International business partners and clients we have developed both an understanding and a significant level of experience of the above factors and their importance to investors. Over the coming weeks we will review, through a series of blogs, the various aspects which makes Ireland a good place to do business!
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