By: Alan Sasserath & Marie Bradley
If you’re a U.S. business owner interested in expanding overseas, your first question is likely: where do I start? At Sasserath & Zoraian, LLP, we maintain several longstanding relationships with overseas firms to assist our clients as they navigate the complex world of international tax and international business. As a result, we’ve noticed that many U.S. businesses interested in cross-border expansion are unsure which location would be best to lay a foundation for their multinational company. This article is the first in a series highlighting some of our top picks.
The Republic of Ireland is an excellent location for businesses from startups to more established multinational organizations. Many U.S. businesses find Ireland an attractive base of operations due to its geographic location as midway between the United States and Asia; its membership in the European Union (EU), which allows simple and quick access to the rest of Europe; and the fact that English is spoken there, thus allowing an ease in communication appreciated by many Americans heading overseas for the first time. In fact, Ireland is the only English-speaking member of the EU that is on the Euro standard of currency, enabling businesses to avoid any exchange rate issues when dealing with other EU member states.
Ireland attracts huge amounts of foreign direct investment (FDI), second only to Singapore, which is due in part to government tax incentives and other public assistance available for high-growth companies. In 2013, Forbes ranked Ireland as one of the best countries for growing multinational businesses. The World Bank has ranked Ireland as number 23 out of 190 measured economies for ease of doing business, with its pro-business policy framework promoting a competitive business environment. Ireland’s 12.5% corporate tax rate is one of the lowest in the world. Attractive tax incentives are also available to intellectual property and research and development companies. Ireland has signed comprehensive Double Taxation Agreements (DTAs) with 74 countries and 73 are in effect.
Ireland has successfully attracted foreign investment since the 1980s. It has a well-educated, highly skilled workforce complemented by its ability to attract non-nationals to study and work. This talented workforce is one of the youngest in Europe and is experienced in assisting multinational companies. Significant government spending on education, Dublin’s reputation as a key destination for international students studying abroad, and Ireland’s growing reputation as Europe’s “Silicon Valley” indicate that talented individuals will continue to seek opportunities in Ireland.
Ireland has an impressive foreign direct investment track record and is home to some of the biggest names in the technology, financial services, and pharmaceutical industries. Fifty percent of the world’s top banks, the top five global software companies, 18 out of 25 top financial services companies, and 24 out of 25 of the top biotech and pharmaceutical companies are located in Ireland. One-third of multinational companies in Ireland have had operations in the country for over two decades, and recently many foreign social media and online gaming companies have also chosen Ireland as a base for foreign operations. Finally, Ireland has fast-growing indigenous businesses, including medical technology companies, a software sector that exports to both the U.K. and U.S., and a competitive food and drinks sector.
U.S. businesses typically establish operations in Ireland for the following reasons:
1) setting up an EMEA headquarter or an Irish holding company;
2) undertaking research and development activities and/or setting up shared services centers; or
3) using Ireland as a low-tax hub to expand internationally into Europe and Asia while also maximizing tax returns.
Contact our team with any questions you may have, as well as to get started expanding overseas to Ireland!
About the Authors
Alan Sasserath, CPA is a Partner and Co-Founder of S&Z. He has over 30 years of public accounting experience and a broad background in accounting, tax, audit and financial planning. A member of International Tax Practitioners, a global group of experienced CPAs, accountants and lawyers, he is one of S&Z’s go-to resources for international tax concerns.
Alan specializes in international tax planning and compliance, transfer pricing review, transactional advisory, expatriate tax services, international business advisory and international outsourcing. He works with businesses and high net worth individuals regarding matters of both domestic and international tax.
Alan can be reached at alan@sz-cpas.com or +1 631-368-3110
Marie Bradley is Managing Director of Bradley Tax Consulting. She has broad experience in advising personal and corporate clients having previously worked in the taxation departments of PricewaterhouseCoopers and KPMG advising Irish and foreign multinational companies.
Marie is a highly experienced tax professional having particular expertise in the areas of Irish and international corporate acquisitions, foreign direct investment into Ireland and cross border tax planning for Irish companies expanding abroad. She is a Fellow and past president of the Irish Taxation Institute.
Marie can be reached at marie.bradley@bradleytaxconsulting.ie. Learn more about Bradley Tax Consulting at www.bradleytaxconsulting.ie