Since the UK voted to leave the European Union last June, we have seen an increase in enquiries to our Foreign Direct Investment Department from UK based companies across all industry sectors who are assessing the likely risks to their future operations across Europe.
With Brexit casting uncertainty over the free movement of goods and of people, the key concerns for these companies include:
- Customs duty and VAT implications on the movements of goods between UK and EU
- VAT and Withholding Taxes implications on cross border supplies of services
- Issues relating to their workforce, including immigration, taxes and mobility policy implications
Examples of recent enquires to our Foreign Direct Investment Department
UK Company whose European business is carried out through a licence/franchise model
The Company’s European business is carried out through a licence/franchise model and is in the receipt of franchise fees from its European franchisees.
The Company plans to continue its UK businesses as normal but wants to protect its European licence/franchise operations from the risks associated with the UK’s exit from the European Union. VAT and Withholding Taxes are among the matters of concern for the Company.
We have been asked to advise on the relocation of the European licence/franchise element of the business to Ireland and to provide advice on the qualifying criteria required for the Irish Corporate Tax rate of 12.5% in respect to its European profits.
A UK Company selling its goods in the UK and throughout Europe
Following the decision of the UK to exit the European Union the Company was concerned about the impact this would have on their business.
The Company is looking for advice in relation to potentially relocating its European Sales Division to Ireland in order to protect it from the risks associated with VAT, duties and tariffs.
Additional advice is also required on future extraction of profits and on the criteria to be met for profits within its new Irish Company to qualify for the Irish Corporate Tax rate of 12.5%.
The common thread amongst these companies is the belief that in order to protect their operations from the risks associated with VAT, duties and tariffs, introducing Irish based companies into their group structures and positioning themselves in the EU is their obvious course of action to effectively carry out their business in Europe.
How we can help?
Our experienced Foreign Direct Investment team will advise you on how best to structure your Irish operations. We will work with you in dealing with your tax and company obligations. Once you are set up, we can provide you with the full range of professional services required to run your Irish branch.