Why UK Businesses have moved to Ireland post Brexit

On January 1st 2021, the UK officially left the European Union. As a result, UK businesses trading within the EU have faced many issues. The new trading relationship between the two markets has created new complications. UK and International businesses (with operations in London) have been moving their operations to Ireland following Brexit as Ireland operates in the EU single market. As well as boasting a lot of benefits to businesses.

Issues UK Businesses are facing

1.  Customs procedures – UK businesses trading in the EU have to comply with new regulations. Businesses have had to make changes to comply with new procedure, additional paperwork, gaining new permits and licenses. Therefore causing time delays and increased costs.
2. Tariffs – exportation to the EU is faced with tariffs, this increase in cost affects the ability for UK businesses to compete in the EU market.
3. Border/Custom checks –  exportation faces border checks and being tasked with completing customs procedures. Consequently, this has added the issue of delays, affecting timely deliveries and also increasing shipping costs.
4. Market access – Brexit has made it more difficult for UK businesses to sell their products/services in the EU. Without the single market and customs union, cost is increased. Furthermore, border checks are slowing timely deliveries and affecting UK businesses’ opportunity to compete.
5. Labour and Skills Shortages – Brexit stopped the free movement of people between the EU and the UK, making it a grander task for EU citizens to work there. This has led to labour and skill shortages in various sectors.

Since 2021, a number of UK businesses have moved their bases here to Ireland.

Why Ireland?

Ireland does not have border issues causing delays to shipments, increased tariffs due to operating between two different markets. In fact, studies have shown that the greatest benefit to operating out of Ireland is the access to markets. Other benefits to establishing in Ireland include:

Tax

• Ireland’s corporate tax rate is 12.5% (half of the UK’s). Non-trading revenue is taxed at 25%.
• Start-up businesses are exempt from corporation tax for their first three years (if profits are less than 320k).
• A 25% tax credit is available on qualifying for R&D spend – including staff salaries and other direct R&D costs.
• Ireland has tax treaties with 74 nations including UK, US, Australia, China, Canada & Japan.
• No withholding tax on dividends from Irish Company to holding companies in EU/Tax treaty countries.

Legal System

• The legal environment in Ireland uses the same common law system in use in Australia, Canada, New Zealand and the US.
• Property rights are protected under the law both as a freehold owner and/or as a tenant.
• Copyright laws provide protection against infringement of a variety of works including original databases, literacy, dramatic or artistic works, films, and television programming.
• Both designs and trademarks are protected where the necessary statutory criteria are satisfied. In addition to this protection, trademarks are also protected under common law.
• Ireland has a strong reputation for data protection. There is a dedicated Data Protection Commissioner charged with overseeing the enforcement of data protections laws, designed to protect the data that is used by businesses.

Language and Common Travel Area

• Post Brexit Ireland is the only EU nation where the predominant language is English.
• British citizens are entitled to continue to come to Ireland to live and work. There are no conditions, caveats or restrictions attached.

Labour Market

• Ireland’s unemployment rate is below the EU and Eurozone average. Additionally boasting the youngest population in the EU (1/3 of population is under 25). There is strong employment growth with over 2.2m people at work.
• 63% of the Irish population is sub 44 years old. 58% of 25-34 year olds have a third level qualification.

Business Environment

Irish government policy is strongly favourable towards outside investment into the country. This is reflected in:

• Favourable tax system.
• Continued focus and investment in the education sector.
• Foreign investment is welcomed and supported by State agencies including the IDA and Enterprise Ireland.
• Free movement of workers from the UK and other EU countries and a work permit system in place for employees outside these areas.
• Ireland is now home to bases for:
  – 9 of the top 10 US technology companies including Apple, Microsoft & Facebook.
  – 9 of the world’s top 10 pharmaceutical companies including Pfizer, Glaxo, and Abbott.

Ireland is an ideal country to move operations to. The government are committed to attracting foreign investment, additionally Ireland boasts tax incentives, access to the EU market, a high skilled workforce and a supportive business environment.