There is no requirement for the shareholders or directors of an Irish company to live in Ireland. Entrepreneurs and businesses from the United Kingdom, the United States, Asia and beyond regularly incorporate Irish companies to gain a base in the European Union, access the single market and benefit from Ireland's 12.5% corporation tax rate on trading income. However, Irish law includes several rules designed to make sure every company has a real connection with the State and can be held to account, and these apply with particular force to non-resident founders.
The EEA-Resident Director Requirement
Section 137 of the Companies Act 2014 requires every Irish company to have at least one director who is resident in the European Economic Area (EEA). Residency, not nationality, is what counts, and since Brexit a UK-resident director no longer satisfies the rule. A company without an EEA-resident director has two alternatives:
- A Section 137 bond:
an insurance bond of €25,000, valid for two years, which exempts the company from the requirement.
- A Section 140 certificate:
available to companies that can demonstrate a real and continuous link with one or more economic activities in Ireland, usually established businesses with Irish staff and premises.
Identity Verification for Directors
The Companies Registration Office (CRO) requires each director to provide a Personal Public Service Number (PPSN) when the company is formed and when they are appointed. Directors who do not have a PPSN, which includes most people who have never lived or worked in Ireland, must instead complete an identity verification process with the CRO to obtain an alternative identification number. Beneficial owners without a PPSN also go through a separate verification process with the Register of Beneficial Ownership. These steps add time to the formation process and require certified identity documents.
Registered Office and Company Secretary
Every Irish company must have a registered office address in Ireland. This is where official correspondence from the CRO, Revenue and other bodies is sent and where legal documents can be served, so it must be an address where post is reliably received and handled. Companies whose founders live abroad commonly use a professional registered office service. Every company must also have a company secretary, and where the company has a single director, the secretary must be a different person or firm.
Tax Registration and Tax Residence
Once incorporated, the company must register with the Revenue Commissioners for corporation tax and any other relevant taxes, such as VAT and employer PAYE. Revenue applies additional checks to companies with non-resident directors and may request evidence of genuine business activity in Ireland, such as details of the planned trade, customers, suppliers and an Irish presence, before granting a VAT registration. A company incorporated in Ireland is generally treated as tax resident in Ireland, although a double taxation treaty can override this where the company is managed and controlled in another country. Directors' fees paid by an Irish company are also generally subject to Irish payroll taxes, even where the director lives abroad.
Banking
Opening a business bank account is often the most time-consuming part of establishing an Irish company from abroad. Irish banks carry out detailed anti-money laundering checks on directors and beneficial owners and generally expect to see a clear link between the company and Ireland. Many non-resident companies begin with an EU-regulated payment provider offering an Irish or European IBAN while a traditional bank account is arranged.
Immigration Is a Separate Matter
Forming or owning an Irish company does not give a non-EEA national the right to live or work in Ireland. Founders who intend to relocate need the appropriate immigration permission, such as approval under the Start-up Entrepreneur Programme (STEP) for innovative, high-potential start-ups.
Ongoing Compliance From Abroad
After formation, a non-resident company has the same ongoing obligations as any other Irish company, including the annual return, financial statements, tax returns and beneficial ownership updates. Missing a deadline can be harder to correct from overseas, which is why many non-resident founders appoint an Irish service provider to manage their company's compliance.
For further guidance and support with setting up an Irish company as a non-resident, contact Setup Your Company at info@setupyourcompany.ie or call us on 01 628 3177.
