Tax

GUIDANCE ON NEW PARTICIPATION EXEMPTION PUBLISHED

Ireland introduced a participation exemption for qualifying distributions made on or after 1 January 2025. The new regime is optional, and the existing “tax and credit” system continues to apply where companies do not opt into the new regime or where a distribution does not qualify.

For more details on the exemption please see our briefing: Ireland introduces a participation exemption for foreign distributions.

On 6 May 2025, the Irish Revenue published Guidance on the application of the new exemption.

GLOBAL MINIMUM TAX – PILLAR TWO UPDATE

Negotiations on the future form of the Pillar Two global minimum tax are taking place at the OECD. The OECD and EU are considering various options to amend Pillar Two to alleviate US concerns that it interferes with US fiscal sovereignty. The UTPR is currently included in the list of unfair foreign taxes under the proposed new Section 899. Some proposals being discussed at the OECD are placing the UTPR safe harbour on a permanent basis, classifying the US GILTI regime as equivalent to the IIR and amending the treatment of US tax credits to give more favourable treatment under Pillar Two rules, with the aim of having the US tax regime coexist with Pillar Two. The EU has implemented Pillar Two by means of a Directive and as such the framework and contents of that Directive must be respected as part of the negotiations.

EURONEXT DUBLIN PRE-BUDGET SUBMISSION 2026

Euronext Dublin published its pre-budget submission to the Government ahead of Budget 2026. The submission, titled ‘Mobilising the Markets to Finance Irish Enterprise Growth’, contains four proposals aimed at attracting more companies and retail investors to Ireland’s equity capital markets:

introduce a stamp duty exemption on the trading of shares in companies with a market valuation of less than €1 billion;

• increase the lifetime limit for CGT Entrepreneur Relief by a further €1 million – to a total of €2 million – but with the additional limit only available for disposals of shares on approved EEA markets;
• create an incentivised savings and investment account scheme for Ireland, based on the previous Irish Equity Market Forum proposal for a Growth & Returns Account, offering savers an accessible, equity-focused product and creating an attractive new source of finance for scaling enterprises listed on public markets;
• establish an Irish Equity Market Growth Fund to provide equity finance to companies listed, or intending to list, on Irish markets, with a focus on Irish scale-ups.