Brexit And Irish Tax

There’s a great article on Ronan Daly Jermyn’s website about some of the potential impacts of Brexit on existing Irish tax legislation.

It considers both companies and individuals and sets out some of the potential problem areas.

Companies…

Companies could be affected in the areas of restructuring reliefs and changes to tax that will affect trade.

Restructuring reliefs

Companies Capital Gains Tax Group Relief and Stamp Duty Relief on Corporate Reconstructions carry potential problems because the reliefs rely on the company being EU resident.

Corporate Migration also imposes an exit charge on companies leaving Ireland. But this is deferred if the company is moving within the EU or EEA. Depending on how Brexit is arranged there is a potential problem for a company leaving Ireland for the UK.

The article also brings out that as these reliefs carry clawbacks for transactions in the last 10 years there could be a problem for past transactions not just for future events.

Tax changes

Brexit is likely to make changes to VAT and customs tariffs. At the least this will make business more complicated.

Individuals…

The article highlights that individuals are able to benefit from reliefs such as:

  • CGT relief for holding certain land and buildings for 7 years
  • EIIS relief
  • CAT – Agricultural relief

But these all rely on the assets involved being located in the EU or in some cases the EEA.

The article highlights the probability that Irish tax legislation will be updated to help overcome these problems, and gives some thoughts on matters that will remain unaffected despite Brexit.

You can read the article in full here.

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