One of the key factors in establishing tax residency in Ireland is to demonstrate that a company’s central management and control is exercised in Ireland.

- Andrew Ryan, IMC Finance Director

To be considered tax resident in Ireland, the ongoing operation of a company must demonstrate that central management and control is exercised by the Irish company’s board of directors and that all critical business and strategic decisions are directed by the board of the Irish company.

Critical factors to be taken into consideration in determining central management and control are:

• Who the present directors are and where the (majority) of them reside;
• Where the directors’ meetings are held;
• Where the major contracts are negotiated or agreements concluded;
• Where the questions of important company policy are determined;
• Where the company seal, minute books, and share register of the company are kept;
• Where the accounts are prepared and audited; and
• Where the bank accounts of the company are.

Taking the factors above into account, the following should be considered:

• Constituting the board of the company such that the majority of directors are Irish resident directors (or at least 50% are Irish resident);
• Holding quarterly board meetings in Ireland with all directors attending such meetings in person;
• Making key decisions at Irish board meetings:
  • - Making all strategic decisions in relation to the company’s business;
  • - Reviewing and/or approving major contracts, which would be signed by an Irish resident director;
  • - Making key management decisions in relation to setting and changing business policy;
  • - Demonstrating that the board is actively seeking new opportunities to develop the business; and
  • - Making all financing decisions.

For more information on how IMC can help companies demonstrate substance in their Irish entities, please click here.