Benefits of Starting a Business in Ireland
In 2024, Ireland’s gross domestic product (GDP) reached an all-time high of $577.39 billion, according to Trading Economics. The country ranked 11th in Forbes’ “Best Countries for Business” ranking.
Ireland is often called a tax haven – and for good reason. The local tax system is extremely loyal to companies. The corporate income tax rate is one of the lowest in the EU, and a transparent legal framework and fast registration procedures significantly facilitate market entry.
Business Structures in Ireland Explained
LTD – Private Company Limited by Shares
A private limited liability company (LTD) is a popular legal form due to its limited liability. This means that shareholders are only liable up to the value of their contributions, which protects their personal assets from the claims of the company's creditors.
However, an LTD also has disadvantages. It may face additional obligations, such as mandatory financial auditing if certain turnover thresholds are exceeded or if reports are submitted late.
DAC – Designated Activity Company
A DAC type company is created with clearly defined goals and areas of activity. DAC provides limited liability for participants, and also allows the issuance of different classes of shares, which is a convenient tool for raising capital.
PLC – Public Limited Company
A PLC is a company that has the right to publicly place its shares on the stock market, which allows it to raise significant capital to scale the business. Limited liability of shareholders provides financial protection, and the status of a public company significantly increases trust from investors, partners and the market in general.
However, setting up a PLC is an expensive process, involving high legal and administrative costs.
Branch Office – External Company
A branch of a foreign company in Ireland is not a separate legal entity. It acts on behalf of the parent company, which is fully liable for its obligations. To open a branch, it is necessary to submit to the Irish authorities legalized constituent documents, the latest financial statements and appoint a person responsible for accepting legal documents and complying with the law (this person must be an Irish resident).
CLG – Company Limited by Guarantee
CLG is a common form for non-profit organizations, charitable foundations, associations, sports clubs or housing management companies. The main feature is the absence of shareholders and share capital: instead, the company has guarantor members who undertake to contribute a symbolic amount (usually 1 euro) in the event of the company’s liquidation.
Essential Requirements for Company Formation in Ireland
To establish a company in Ireland, you must meet a number of basic requirements set by law. Foreigners who are residents of the EU, EEA or Switzerland are eligible to act as directors of the company in Ireland without any restrictions. If none of the directors is a resident of the EEA, the company must enter into a special financial guarantee (bond) in the amount of €25,000 – as a mechanism for ensuring liability in the event of debts. In addition, legal entities are required to follow standard administrative procedures: submit annual tax returns and update the company's registration details by submitting an annual return.
Step-by-Step Guide to Registering a Business in Ireland
Once the legal form of the company has been chosen, the process of forming a company begins, which involves a number of important steps.
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Choose a company name and check its availability.
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Determine the registered office address of the company in Ireland.
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Appoint at least one director and one shareholder.
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Appoint a company secretary.
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Prepare a company constitution indicating the authorised and issued share capital, signed by all shareholders.
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Obtain a certificate of incorporation from the CRO.
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Register the company with the Revenue Commissioners for income tax, VAT, etc. requirements.
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Open a corporate bank account.
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Register UBO’s.
Timeline and Costs for Company Set Up
The official fee for registering a company in Ireland is €50 when applying electronically through the Companies Registration Office.
The registration period usually ranges from one to two weeks and depends on how correctly and completely the submitted documents are prepared.
Using an Employer of Record Instead of Incorporating
For many companies looking to start a business in Ireland or hire employees in the country, an alternative to setting up a legal entity is to work with an Employer of Record (EOR) service provider.
An EOR is an external organisation that formally registers employees on behalf of the company, allowing them to operate in a new country without the need to set up their own branch or legal structure. This model allows them to comply with all the tax, labour and immigration requirements of the employee’s host country, including Ireland.
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