Import Procedures

For goods imported from outside the European Union (EU), a customs declaration must be completed by the importer or his agent. This customs declaration must be made electronically using Revenue’s Automated Entry Processing (AEP) system. Some goods are prohibited and some are subject to conditions or may require a licence.

To release goods at import any charges must be paid (customs duty, value-added tax, excise duty). This can be done by the approved deferred payment account or Electronic Fund Transfer (EFT). The following documents must be available if requested by Revenue at the time of clearing goods:

• invoice
• certificate of origin
• import licence and suchlike.

More information is available on the Guide to Customs Import Procedures of the Revenue Commissioners.

As part of the 'SAFE' standards advocated by the World Customs Organisation (WCO), the EU has established a new system of import controls, the 'Import Control System' (ICS), which aims to secure the flow of goods at the time of their entry into the EU customs territory. This control system, which is part of the eCustoms Initiative, has been in effect since 1 January 2011. Since then, operators are required to provide an Entry Summary Declaration (ENS) to customs officials in the country of entry, prior to the introduction of goods into the EU customs territory.

For more information, please visit the website of the Revenue Commissioners.

Specific Import Procedures

You can find the full list of the prohibited and restricted goods on Prohibitions and Restrictions Guide of the Revenue Commissioners. The guide also includes information on licenses, permits, authorisations that are needed to import or export these goods.

Distribution channels

The Irish retail market is made up of small and family owned stores. There are approximately 37,400 active wholesale and retail enterprises across the country (of these, 85% have less than 10 employees). The number of discount firms continues to increase, and the number of self-service stores is rising steadily. Self-service is not confined to small merchandising units. Department stores and gas stations also have incorporated this sales technique into their operations.

According to Retail Ireland, the wholesale and retail sector is the country’s largest employer with 280,000 jobs, accounting for 14% of total employment. Data from the Central Statistics Office shows that the volume of retail sales increased by 0.6% in March 2022 when compared to February 2022 on a seasonally adjusted basis. On an annual basis, retail volumes were 2.9% higher in March 2022 compared with the same period one year earlier. The value of retail sales increased by 0.3% in the month and grew by 4.8% on an annual basis.

E-commerce is growing faster than traditional retail, a trend that was accelerated by the COVID-19 epidemic and the restrictive measures that followed in the spring of 2020. However, as the volume of in-person shopping increased with shops reopening, the proportion of total retail sales transacted online has fallen from the high of 15.3% recorded in April 2020 to 5% in March 2022. According to Retail Ireland, the proportion of Irish consumers who frequently shop online increased to over 50% in recent years. The organic sector is also growing, as 47% of consumers are prepared to pay a premium for organic products (Bord Bia).

Distribution market players

There are five main grocery retailers in Ireland in the supermarkets channel:

• Dunnes stores held 22.4% of the market share in 2022 (Kantar World Panel)
• Musgrave Group, with SuperValu supermarkets (21.6%)
• Tesco, with the same brand name stores (21.3%)
• German discounter Lidl (13%)
• Aldi (12.4%)

Retail Sector Organisations

Retail Ireland - Representative body for the entire retail industry in Ireland

Consumption Taxes

Nature of the Tax

Value-added tax (VAT)

Tax Rate

23%

Reduced Tax Rate

A 9% rate applies to magazines, electronic magazines and e-books, admission to sporting facilities, and  hairdressing services.

Examples of goods and services taxable at 13.5% include gas and electricity, hospitality and tourism, restaurant and catering services, repair, cleaning and maintenance services, developed immovable property, and building services.

For an exhaustive list of VAT rates in Ireland, consult the Revenue's VAT rate database.

Other Consumption Taxes

Ireland applies excise duties on mineral oils, alcohol products (including spirits, beer, wine, cider, and perry), and tobacco products. Irish microbrewery can enjoy reduced excise duty rates (depending on production quantities). For more information, please refer to the Irish Tax and Customs website.

An environmental tax of EUR 22 cents per bag is imposed upon consumers provided with a plastic bag. A carbon tax is levied on mineral oils, generally at a rate of EUR 41 per tonne of CO2 emitted. A tax also applies on sugar-sweetened drinks (20 cents/litre if the sugar content is five or more grams of sugar per 100ml and 30 cents/litre for drinks with eight or more grams of sugar per 100ml).

Corporate Taxes

Company Tax

12.5%

Tax Rate For Foreign Companies

With few exceptions, a firm legally established in Ireland is automatically considered an Irish resident for tax purposes. A firm is also considered resident for tax purposes if it is managed and controlled in Ireland.
According to Irish laws, a non-resident company will be deemed to have a permanent establishment in Ireland if it has a fixed place of business in the country through which its business activity is wholly or partly carried on, or if it has an agent that acts on behalf of the company and who habitually exercises authority to do business in Ireland on behalf of the company.

Capital Gains Taxation

Companies that are considered residents of Ireland are responsible for paying corporation tax on all "chargeable gains" resulting from the sale of assets worldwide. Meanwhile, non-resident companies are subject to capital gains tax (CGT) only on the sale of "specified assets," which also includes certain assets used or held for business purposes by an Irish branch or trade, on top of the aforementioned assets.
Capital gains are generally taxed at 33% (40% for the transfer of life insurance contracts and investment units held in offshore funds) with exceptions provided for qualifying gains from the sale of shares in companies that reside in the EU or in countries that have a tax treaty with Ireland. The cost of acquisition or improvement of an asset is deductible from the nominal gain. Capital assets may be transferred between Irish resident group companies without liability for capital gains tax. There are reduced tax rates applicable to chargeable gains in certain situations. Partnerships and individuals may pay tax at a rate of 15%, while companies may pay at a rate of 12.5%. These rates may also apply to gains obtained from a "carried interest," which is a share of profits received from specific venture capital funds that engage in research, development, or innovation activities. For individuals who are eligible for Entrepreneur Relief, a reduced rate of 10% may apply to disposals.

A participation exemption applies to capital gains obtained by holding companies (Irish residents) on the disposal of shares in firms that are resident in Ireland, the EU or countries that have a tax treaty with Ireland. In order to qualify, the holding firm must hold a participation of at least 5% and the interest must have been held for a continuous 12-month period ending within the 24 months preceding the date of disposal.

Main Allowable Deductions and Tax Credits

Deductible expenses must be incurred wholly and exclusively for the purposes of business transactions and/or to generate revenue. As such, entertainment expenses are non-deductible. Revenue expenditure incurred up to three years before a business activity begins is generally deductible. Depreciation is non-deductible but can be offset by capital allowances. Generally, deductions can be claimed for royalties, management service charges, and most interest charges paid to foreign affiliates, provided the amounts do not exceed what would be paid to unrelated entities. Contributions to certain employee pension schemes are deductible in the year they are incurred.

Expenditure on scientific R&D and payments for the acquisition of know-how are generally deductible, as are the costs of obtaining or extending patents and obtaining and renewing trademarks. These expenses give rise to a tax credit of 25% which can be used to offset the tax debts of a firm established in the tax year during which expenses were incurred. A Knowledge Development Box (KDB) regime allows for profits from patented inventions and copyrighted software earned by a company residing in Ireland to be taxed at an effective rate of 6.25% (planned to be increased to 10%).

Companies are entitled to a deduction, as a trading expense, for qualifying donations to approved charities, educational institutions, schools, churches, research foundations, sports bodies, and other approved organisations that satisfy certain conditions (the donations must be above EUR 250).
Local taxes, VAT not recovered and the employer’s share of social security contributions are tax-deductible.

Net operating losses can be carried forward indefinitely or be offset against other income of any nature, either in the current or preceding accounting period. Terminal losses that arise within 12 months of the date a company ceases its activities may be carried back three years.

Other Corporate Taxes

Companies may be subject to other taxes, including stamp duties (rates of 1% to 10% for transfers of residential property, 7.5% for transfers of non-residential property, and 1% on transfers of shares); local property taxes ("rates" on the occupation of commercial real property; plus a tax on residential real estate at 0.18% for real estate valued up to EUR 1 million, 0.25% for values over EUR 1 million) and industry-specific taxes such as a construction operations tax and a shipping tonnage tax (that can replace the corporate income tax). An additional "profit resource rent" tax applies to certain petroleum activities (from 25% to 40%).
A carbon tax is levied on mineral oils (e.g. auto fuels, kerosene) that are supplied in Ireland. The rates of the carbon tax on oil and gas broadly equate to EUR 41 per tonne of CO2 emitted (shall be increased to EUR 100 by 2030).

The employer contributes 11.05% of employees' salary for social security (Pay-Related Social Insurance - PRSI).

Gross premiums paid for non-life insurance policies relating to risks located in Ireland are taxed at 3% (plus 2% for the Insurance Compensation Fund), reduced to 1% for certain life insurances.
A bank levy applies to banks and building societies and is calculated as 308% of the amount of DIRT (Deposit Interest Retention Tax) paid by the bank or building society in the 2019 base year.

An exit tax charge applies on unrealized gains of companies that migrate or transfer assets offshore, without actual disposal, such that they leave the scope of Irish tax. The tax rate is 12.5% but is subject to an anti-avoidance provision that applies a higher rate of 33% in certain circumstances.

A capital acquisitions tax may apply on gifts and inheritances at a rate of 33%.

Other Domestic Resources

Irish Tax and Customs

Doing Business Website, Consult the Doing Business Website to obtain a summary of taxes and mandatory contributions in Ireland.

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed

See the list of double taxation treaties

Withholding Taxes

• Dividends: 25%
• Interest: 20%/33% (paid to deposit holders of certain Irish banks)
• Royalties: 20%

Rates may be lower in force of a double taxation treaty or of specific exceptions.