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UK – Ireland Double Tax Treaty

UK – Ireland Double Tax Treaty

British investors who want to establish a business presence on the Irish market are entitled to a set of tax regulations and incentives prescribed under the legislation of the UK – Ireland double taxation agreement. The treaty was signed on 2nd of June 1976 and entered into force on 23rd of December 1976; it was further amended in 1976, 1994 and 1998 and it prescribed the legal framework under which the double taxation on income is applied to natural persons and business investors living and working in the two contracting states; businessmen who want to receive more information on the treaty on the avoidance of double taxation can be assisted by our team of Irish solicitors

Taxes under the UK – Ireland double tax treaty 

British businessmen who are interested in opening a company in Ireland should know that the double tax treaty is applicable to persons and legal entities which are residents of one of the contracting state. The agreement is applicable to income taxes, as prescribed by the local legislation of each country.

The state of Ireland will apply the following taxes on its territory:

• the income tax;

• the corporation profits tax;

the corporation tax;

• the capital gains tax.

United Kingdom (UK) applies the next taxes: 

• the income tax;

• the corporation tax;

• the petroleum revenue tax;

• the capital gains tax. 

The taxes are applicable for individuals and any type of legal entities, nationals of a contracting state with activities in the other contracting state; our Irish solicitors can provide you with more details on the British and Irish taxation systems. 

Stipulations of the UK – Ireland double taxation agreement 

Business activities established in Ireland by a British investor are considered a permanent establishment if they have a fixed place in which the company carries out its operations. They are also a permanent establishment if the business operates in Ireland for only a part of its entire operations. 

permanent establishment refers to: 

• a place of management;

a branch of a company;

• an office;

• a factory or a workshop;

• a mine or other type of factory designated to the extraction of natural resources;

• a building site with operations longer than six months. 

Income incurred from immovable property will be taxed in the contracting state in which the property is situated, while the business profits of a British company with activities in Ireland will be taxed only in UK. In the situation in which the British company operates in Ireland through a permanent establishment, the profits will be taxed in Ireland

If you need further information on the UK – Ireland double taxation agreement, please contact our team of Irish lawyers for assistance.