Ireland as a Holding Company Location Ireland has long been an attractive location for the establishment of international holding companies due to its low corporate tax environment, its extensive tax treaty network and its general ability to pay dividends free of withholding taxes. Benefits include: Ø  Corporate tax rate of 12.5% on domestic trading income. Ø  Capital Gains Tax exemption on disposals of subsidiaries in Ireland, the EU or treaty countries (including countries with which Ireland has signed but not yet ratified a tax treaty). Ø  The Irish tax code does not contain controlled foreign corporation, specific transfer pricing or thin capitalisation legislation. Ø  Relieving of foreign taxes on dividends received by Irish companies under unilateral provisions under Irish law, in accordance with the EU Parent Subsidiary Directive and under bilateral treaty provisions. Ø  Foreign dividends which have emanated from trading profits are also taxed at the 12.5% trading rate. This is also the case where the dividends have been paid out of dividends received from lower tier companies engaged in trading activities. In most cases the low tax rate coupled with the double tax relief ensures that no further liability to Irish tax arises on the receipt of such dividends. Ø  In cases where the foreign tax exceeds the Irish tax on a specific dividend the excess may be offset against Irish tax on the remaining foreign dividends on a “like for like” basis. This on-shore pooling also ensures that unused tax credits may be carried forward indefinitely. Ø  Potential for intermediate holding companies to migrate from Ireland without incurring a tax charge. Ø  Tax free and withholding tax free capital distributions for non-resident individuals on liquidations in most cases. For more information or advice please contact John MacNally at: john.macnally@fmb.ie  or 00353 1 645 2002