Corporate Tax Rates

Tax rate

The Corporate income tax rate is 12.5%.

Exemptions from corporation tax

  • Dividend income
  • Interest Income that does arise from the ordinary activities or is closely connected to the ordinary activities of the company
  • Profit from the disposal of securities.

Deductions

All expenses incurred wholly and exclusively for the production of income of the business are considered as tax deductible expenses.

Non-deductible expenses

The following are not deductible from income:

  • Business entertainment expenses in excess of 1% of the gross income. (the amount of the expense is limited up to €17,086)
  • Private (saloon) motor vehicle expenses
  • Immovable property tax
  • Professional tax
  • Interest payable or deemed to be payable in relation to the acquisition of a private motor vehicle, irrespective of whether it is used in the business or not, or other asset not used in the business. This restriction is lifted after 7 years from the date of purchase of the relevant asset
  • Contributions to the Social Cohesion Fund
  • Expenditure which is not supported by invoices or other supporting documentation.

Losses

Losses are carried forward indefinitely. As from 1 January 2013 losses are carried forward for only five years from the end of the tax year in which the tax loss arises.

Tax credit for foreign tax paid

Any tax suffered abroad on income which is subject to income tax will be credited against any income tax payable on such income irrespective of the existence of a double tax treaty.