Capital gains are subject to a 33% tax rate. The rules applicable to calculating corporate capital gains are the same as those applicable to capital gains tax for individuals.
As in the United Kingdom, capital gains are aggregated with corporate income in a single corporation tax charge. Broadly speaking this is favourable in allowing offset of losses and gains between these taxes.
An Irish resident company is liable to Irish corporation tax on its worldwide profits and chargeable gains. The tax rate applicable to chargeable gains is 33%. The gain is effectively grossed up by 33/12.5 so that is included in the corporation tax computation at 12.5 per cent.
The Irish system of taxation of non-residents including non-resident companies is similar,but differs to some extent, to that in the UK. Non-resident companies are liable to Irish Capital gains tax in respect of specified assets. They are land buildings mineral and related interests or corporate entities that majority of whose value derives from land buildings minerals et cetera. Development land is subject to specific more restrictive rules.
Where there are losses for an annual period in excess of the gains, they may be carried forward against future capital gains.
Where an Irish resident company disposes of a qualifying shareholding (5% plus) in another company, the gain is generally exempt.
Transfers of assets other than a trading asset within a 75% group are chargeable as gains which are effectively deferred provided the relationship continues. The 75% group may be made up of corporates resident in the European Union or in a country with which Ireland has a double taxation relationship in determining the existence of the 75% group.