Why Form A Company in Ireland?

Ireland has positioned itself as one of the easiest and best countries in the world to do business.

Why Form A Company in Ireland? 

For decades, successive Irish Governments have been trying to position Ireland as one of the easiest places in the world to do business. This page will help you to answer the question; why form a company in Ireland?

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What Should I Consider When Forming a Company in Ireland?

There is a lot less to consider when Forming a Company in Ireland. Over recent years Ireland has become a very favorable place to start a business. The new 2014 act in Ireland makes it easier for Directors to manage a company. It is the goal of the Irish Government to make Ireland the easiest place in the world to do business. The 2014 Act consolidates 17 existing acts dating from 1963 and the goal of this new act is to cut the level of bureaucracy

See a full list of the considerations below:

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Full Guide of Considerations  when Forming a Company in Ireland:

Ireland has a low 12.5% Corporation Tax rate which is one of the lowest in the world as shows our Corporation Tax comparison chart below. Corporation Tax is charged on the profits of the business in a companies accounting period. The accounting period cannot be more than 12 months. As well as a stable tax environment Irelands is a favorable one.

Ireland has a pro business environment and has a modern outward looking economy. Irelands population is made up of 40% of the population being under the age of 29. The workforce is highly educated which allows companies hire talent effectively and effortlessly.

The Share Capital Requirement can be as low as €100. With the amendment of the 2014 Act, you can structure the share capital in a way to keep it very low. You can incorporate a company with Authorized share capital and issued share capital. Issued share capital is taken from Authorized share capital. The most common way to set up a company is by having 1,000,000 Authorized shares valued at €1 each and then issuing 100 shares. If there are 3 shareholders with equal shareholdings, you can issue 120 shares and distribute 40 shares to each. It’s important to note that a single share cannot be split.

Ireland is an English Speaking Jurisdiction, the only one in the Eurozone since the United Kingdom left post Brexit.

Incorporating in Ireland offers free access to over 500 Million consumers in Europe.

Ireland is ranked in the top 10 easiest places in the world to do business.

There are generous Research & Development tax credits and this is a major consideration for companies heavily involved in R&D and a major consideration to answer the question; why form a company in Ireland?

A Company is a legal entity in itself. It is completely separate from the Officers and the people who run it. It is the company that legal action is taken against as a result of unpaid debts for example.

A limited company has greater ability to raise finance by the issue of shares.

The limited company name is protected. If a company registers a name on the Companies Registrations Office, then another person cannot register the name and in many cases a similar name.

The company is protected against sudden changes to Management structure.

Employees can acquire shares in the company.

Making changes to the company is relatively simple. The reduction in bureaucracy in managing companies means that changing a Director, or adding a shareholder is relatively straight forward.


Directors pay income tax, and the company pays corporation tax on company profits.Given the current tax rates, company profits earned and retained in the business are subject to corporation tax at lower rates in comparison to the income tax payable on equivalent profits earned by an unincorporated business. Consequently, this becomes a significant factor to consider when questioning why one should form a company in Ireland.

  • Scope for greater company pension scheme to be secured through a limited company
  • Personal tax advantages can accrue for directors of a limited company

Corporation Tax Comparison Chart

Hong Kong SAR16.5
Russia 20
United Kingdom19
Slovakia 21
New Zealand28
South Africa28
Australia 30
United States21
United Arab Emirates9

Maximizing The Tax Benefits of a Limited Company

One of the main focus for small businesses will be the maximizing benefits to minimize tax. This can be done by:


Ensuring that your company makes pension contributions (if cash flow allows)


Claim the maximum possible expenses allowable under legislation


Capital equipment used in your business is purchased and capital allowances claimed


Ensuring that benefits in kind (insurance, health care etc.) are paid out of the company

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Your Essential Company Set Up Checklist:


Have At Least One Director

A minimum of one Director is required in a Private limited company with shares. You can have more Directors on board if you require it but you need to be aware of the duties and responsibilities of Directors, and that they all have equal powers in a company formation in Ireland. Choose your Directors carefully for your company formation and ensure that they are aware of their responsibilities.


Choose A Company Secretary

In the event that your company is led by a sole director, it becomes imperative to designate a separate entity or individual as the Secretary. However, when there are two or more directors, it’s possible for one of them to also undertake the role of the company Secretary. Irish Formations offers the option to serve as nominee secretary. The company Secretary bears a responsibility in ensuring the company’s compliance with its statutory deadlines. Working in close collaboration with the Accountant, they are dedicated to ensuring the punctual submission of financial statements. Failure to submit the Annual Return on time can result in substantial fines, and the financial statements might require auditing for a span of two years. To eliminate the risk of missing the Annual Return deadline, we will provide timely reminders of these obligations.


Have At Least One Shareholder

The shareholders stand as the proprietors of your company. It’s a common occurrence, especially in new enterprises, for the director to double as the company’s shareholder. However, it’s worth noting that directors are not obligated to be shareholders, and the same holds true in the reverse direction.


Choose A Limited Company Name for the Incorporation Process

When considering the establishment of a Limited Company in Ireland, your initial focus may naturally be on the company name. Nevertheless, it’s important to keep in mind that the Companies Registration Office (CRO) imposes strict guidelines regarding company names. The chosen company name must possess uniqueness, setting it apart from other names already registered in Ireland, and it must adhere to the prescribed company name regulations. The Registrar carries out thorough examinations to confirm the uniqueness of your suggested name. Should it closely resemble existing names on the company registry, the Registrar has the authority to request a different name for resubmission. To streamline the process and save time, it’s advantageous to engage the services of a company formation specialist, such as our dedicated team at Irish Formations. You merely need to provide us with your proposed company name, and we will manage all the necessary procedures on your behalf.

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Have Two Addresses: Business Address and Trading Address for the company.

The registered address pertains to your company’s official legal address. It must be a physical location situated within Ireland and subject to regular monitoring. Many companies choose to obtain a registered address specifically for this purpose, as important notifications are often sent there. It’s noteworthy that this address is publicly accessible on the CRO website. You can delegate this responsibility to a regulated Registered Office Address (ROA) provider, such as our organization. What is a business address, you may ask? The business address functions as the site where your company’s business-related mail, including invoices, is received. It serves as the hub for day-to-day communication concerning the company’s operations. Keep in mind that, for taxation purposes, the Revenue authorities will still need information about the specific location where your business conducts its operations, which is known as the trading address.


Then simply Sign The Incorporation Documents

Once you submit your information on the website we will send you all the PDF’s to sign and return and your company will be incorporated within 3-5 working days. Everything is done remotely for you by email and we provide support at every stage.

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Everything You Need To Do After Incorporation:


File With The Register Of Beneficial Owners

Every Irish company must register its beneficial owner, defined as anyone holding 25% or more of the company’s shares, on the RBO (Register of Beneficial Ownership) website within five months of incorporation. Majority shareholders need a Personal Public Service Number (PPSN) or can use the BEN2 form for registration. Many tend to streamline this by delegating the Registration of Beneficial Ownership service to experts like Irish Formations, which is integrated into our Premium Packages. Note that establishing a bank account in Ireland hinges on completing this process. Failing to finalize RBO registration is a criminal offense, with potential fines or convictions. Many Irish banks require RBO registration before allowing your company to open a bank account.


Registering Your Company For Tax

When establishing new companies in Ireland, the process of tax registration holds significant importance. You must complete this step before you start trading and issue invoices to clients. Typically, a third party manages the tax registration procedure independently.

Various taxes apply to Irish companies, including:
Corporation Tax
One of the lowest in the world at 12.5% on profits.
Value Added Tax (VAT)
Consumption tax applicable to most goods and services sold in Ireland.
Relevant Contracts Tax (RCT):
Withholding tax imposed on specific construction-related activities in Ireland.
Employers PAYE and PRSI:
Employers are responsible for deducting the appropriate amounts of income tax, Universal Social Charge (USC), and Pay-Related Social Insurance (PRSI) from their employees’ pay.

Managing tax payments and filing tax returns can be intricate, given the stringent deadlines and potential consequences for non-adherence. Our premium company formation packages encompass tax registration and the filing of your initial B1 Annual Return to the companies registrations office, which is due within six months. For subsequent requirements, we recommend seeking assistance from an Accountant. This approach guarantees both adherence to regulatory standards and a sense of assurance. By doing so, you can concentrate on your business activities while entrusting tax-related responsibilities to capable professionals. At Irish Formations, we can direct you to our affiliated entity CACM Accountants, a firm specialized in Audit, Tax, and Compliance services. They would be delighted to provide a quote tailored to your specific needs.


Open the Bank Account in the name of the company

For the opening of a business bank account in Ireland, it’s generally necessary for at least one director to participate in an in-person meeting with a bank representative if you go with Bank of Ireland or AIB Bank. Alternatively you can choose a remote bank provider such as Revolut or Fire.com. Before proceeding with the process of setting up a company bank account, you should have the essential company documents at hand. These documents encompass the original certificate of incorporation, your company constitution, and a copy of the A1 form. Essentially, the setup of the bank account hinges on the successful incorporation of the company.


First Annual Return Submission

Once your company successfully incorporates, you must submit Annual Returns to the CRO, even if your business is not actively engaged in trading. You must submit the initial Annual Return within six months following incorporation. There’s no requirement to file financial statements during this stage. Companies have 56 days to complete all necessary aspects of the Annual Return. It’s crucial to note that failing to meet this deadline results in significant penalties. As part of any of our premium packages, we offer this service and manage it on your behalf.

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