I'm currently working as an IT consultant in Italy (self-employed) but I'm thinking of moving to Ireland next year and open a ltd company there.

I was trying to understand the tax rates and as per my understanding there is a fixed corporate tax of 12.5% for 'trading income with “substance” in Ireland' (cit.) and 25% for all other cases.

Now that's the part I don't understand, what does it mean to have trading income with substance in Ireland?

I'll plan to move there, find an apartment and find local clients. I think the tax rate for those new clients will be 12.5%, right?

My doubt is about the tax rate for old clients in Italy. Of course I don't want to lose them so I'll still work for them in remote and send them an invoice from my ltd. Will those "foreign" income be taxed at 12.5% or 25%?

Thanks in advance.

1 Answer 1


This link suggests the different rates are for:

  • 12.5% : normal income.
  • 25% : passive income (e.g. dividends, royalties, etc.)

So both your Irish and Italian client income should be taxed at 12.5%, unless you are charging royalties as part of your service.

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    Jul 21, 2017 at 22:23

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