An Irish Limited Partnership
With foreign members
Which does not carry on a business in Ireland and Derives no income on territory of Ireland
Is not liable to tax in Ireland
Irish limited partnership start-up and taxation: many investors who deal with private equity, as well as those with international investment platforms, favour Irish limited partnerships as a vehicle. There are benefits in this partnership model, and much of them owe to the Irish tax system's flexibility.
The Limited Partnerships Act 1907 regulates partnerships in which some members have limited liability for the debts of the partnership as their liability is limited to the extent of the amount of capital contributed by them to the partnership.
A partnership may be made up of natural persons and bodies corporate.
It is not a separate legal entity and accordingly has no legal personality separate and distinct from the partners who form the partnership. Therefore the partners can be sued in their own names.
To form a limited partnership in Ireland, the partnership must have at least one general partner (who is liable for all the debts and obligations of the firm) and one limited partner. The maximum number of partners is 20, unless it is a banking or loan/finance partnership. In the case of a banking partnership the maximum number of partners is 10 and for a loan/finance partnership the maximum number is 50.
If a general partner is a non-EEA resident person, prior permission must be sought from the Department of Justice and Equality.
If a general partner is a company not registered in the Companies Registration Office (CRO) register, documentation relating to the company must be provided with the application.
Limited partners may not play any role in the management of the partnership, so all partners should take care not to breach this obligation as to do so could expose the limited partners to unlimited liability.
If a company is the only general partner the European Communities (Accounts) Regulations 1993 apply so Financial Statements have to be prepared, certified to be true copies by two of the partners authorised to do so and filed with the CRO no later than 6 months after the end of the partnership financial year.
Partners are also obliged to file annual income tax returns on a calendar year basis with the Irish Revenue Commissioners.
Upon the registration of most of business entities in the United kingdom, you will require to register information about the person with the significant control, who does not need to be the ultimate beneficiary owner of your business organisation. Anyway, when you set-up a limited partnership in Republic of Ireland, you are exempt from such rules. You do not need to file information about the beneficiary owners or person with the significant control of your business.
Under the 1907 Act, one of the partners is able to have limited liability under a limited partnership. This means that where debts are concerned, their liability can be 'capped' at the same level of the sum he or she has contributed to the partnership.
This partner is not permitted to be involved in the partnership's management, assuming that they wish to maintain their status as being a limited liability partner. If you wish to startup a limited partnership in Republic of Ireland, please complete our application form or contact us by phone or drop us an e-mail.
In general, Ireland is a jurisdiction with a standard level of taxation. However, Irish legislation provides the opportunity for registration and operating of companies with a zero rate of tax - the Limited Partnerships (LP).
An Irish LP with foreign members, which does not carry on a business in Ireland and derives no income on territory of Ireland, is not liable to tax in Ireland. According to the tax laws of Ireland, a LP is not considered as a separate subject of taxation. The founders should pay taxes from the profits received by the LP in their place of residence in proportions according to their share of interests belonging to them in the LP.Taxes will be paid by the members in the country of their residence if it is stipulated by the legislation of that particular country.
Taxes will be paid by the members in the country of their residence if it is stipulated by the legislation of that particular country.
The favourable tax regime of LP companies does not eliminate the requirements for preparation of financial statements. Every LP is obliged to prepare financial statements, and the relevant Partnership Tax return must be filed annually with Irish Tax Revenue.
In Ireland there are certain obligations, including preparation of financial statements, which must be fulfilled by every type of company, including a LP.
The favourable tax regime of a LP is based on its “pass-through” status in that all profit received by the LP is considered to be transferred to its partners. Accordingly, if the partners are resident in a taxpaying jurisdiction, they will be obliged to pay tax in their country of residence proportionally to their share of participation in the Limited Partnership.
An Irish LP is the ideal solution for those who prefer to operate with an EU-registered entity but to have at their disposal a fully tax-exempt vehicle at the same time.
Irish Limited partnership – the tax planning opportunities are in your favor.
Irish limited partnership is a convenient and effective business tool. Its popularity has only increased in the past few years.
The advantages of registering a limited partnership in Ireland:
- No residency requirement for partners
- Corporate entities can act as partners
- Minimal contribution by each partner can be as low as 1 euro
- No requirement for the contributions to be paid up
- Partnership does not pay corporate tax in Ireland if its partners are not Irish residents and the partnership’s activity is outside of the jurisdiction
Given the above-stated advantages, Irish LP companies are very popular tools for conducting international business.
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