Ireland’s Tonnage Tax Regime

Ireland boasts a very attractive tax regime for shipping operations known as the tonnage tax regime. It is designed to ensure that shipping businesses based in Ireland pay tax on a nominal profit which is based on the tonnage of a vessel as opposed to on actual profit generated by the business. When the tonnage tax regime is combined with Ireland's low corporate tax rate of 12.5%, the result is an extremely low effective rate of tax for shipping businesses located in Ireland.

The main advantages of Ireland's tonnage tax regime are:

• Possibility to determine taxable profits upfront combined with a low 12.5% corporate tax rate on such fixed profits, thereby resulting in a low effective tax rate;