Ireland is expanding its network of double tax treaties
Even if Ireland is not officially an offshore jurisdiction and the term of offshore company is not found in Irish legislation describing company forms, Ireland is renewed as one of the best countries in the world in which to incorporate a company. One of the most compelling reasons for this is the extensive list of tax treaties that Ireland has in place.
Till now Ireland has signed comprehensive double taxation agreements with almost 68 countries, of which 64 are already in effect. The agreements cover direct taxes, which in the case of Ireland are income tax, corporation tax and capital gains tax.
During the last period of time Ireland is underway to negotiate new agreements and to update the existing ones.
About the old agreements Ireland is under process of updating is with Germany, South Africa, Pakistan and with Netherlands.
The new agreements Ireland had already signed are with Armenia, Panama and Saudi Arabia which are affective starting with January 2013 and prepare to bring into force the agreements with Kuwait, Egypt, Qatar, Uzbekistan, Malaysia and Switzerland. In the case of taxation treaty with Panama is of particular interest since it allows wise entrepreneurs to combine a low tax Irish trading company with a zero tax Panama holding company. Panama does not charge tax on income which is foreign derived and dividends paid to the Panama Company will be exempt from Irish withholding taxes once certain conditions are observed.
They are under negotiation also for new agreements with Thailand and Ukraine that have been concluded and are expected to be signed shortly. Negotiations on Protocols to the existing agreements with Belgium and Luxembourg have also been concluded. But we have also to mention about the discussion handle with Azerbaijan and Tunisia in this respect. In the Finance Bill are also amends provisions relating to the Joint Council of Europe / OECD Convention on Mutual Assistance in Tax Matters.
In case a double taxation agreement does not exist with a particular country there are provisions in the Irish Taxes Consolidation Acts (TCA) 1997 which allow unilateral relief against double taxation regarding of certain types of income.
Ireland's tax treaty network compares very favorably with the networks of other larger OECD countries and now includes most of the world's major economies. This shows the high regard in which Ireland's tax regime is held internationally.