Holding company in Ireland: rates, passive income, Pillar Two and comparison with Andorra
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The short answer
Ireland taxes trading income at 12.5 % but passive income at 25 %. For a holding company, the treatment of foreign dividends is therefore the central question, and it is changing; Pillar Two concerns only large groups.
At a glance
Ireland is known for its low rate on trading income. For a holding company, that rate is not the right benchmark: passive income (rents, interest, foreign dividends outside an exemption regime) is taxed more heavily.
The rates
The rate is 12.5 %verified on 12/10/2026 on trading income and 25 %verified on 12/10/2026 on passive income. A holding company that merely holds securities or investments falls mainly under the second.
Foreign dividends
The treatment of dividends received from foreign subsidiaries is the decisive question for a holding company. An exemption (section 831B of the Taxes Consolidation Act) applies to dividends received from 1 January 2025 from subsidiaries established in the European Economic Area or in a treaty country, if the Irish company holds at least 5 %verified on 12/10/2026 of the ordinary share capital for 12 monthsverified on 12/10/2026. The regime is optional and applies per financial year. The 2025 finance act changed the conditions that define the eligible subsidiary (notably the reference period): we do not detail these points, which should be confirmed against the Irish administration's guidance.
Pillar Two
Pillar Two targets groups whose consolidated turnover reaches 750,000,000 €verified on 12/10/2026. It imposes a minimum effective rate of 15 %verified on 12/10/2026, with a domestic top-up tax in Ireland. It does not concern family or small structures.
Who it is for
Ireland suits operating groups with a real presence, including large groups subject to Pillar Two. It is poorly suited to a simple wealth-holding company.
Compared with Andorra
Andorra applies a general rate of 10 %verified on 09/10/2026 and a direct exemption for shareholdings under conditions, with no distinction between trading and passive income for qualifying dividends. Ireland, on the other hand, benefits from the European directives and an extensive treaty network. See the holding company in Andorra.
For a French resident
To verify
The figures on this page come from foreign firms and administrations, checked on 12 October 2026: they are dated in our database and should be confirmed with local counsel before any decision. This page is a benchmark, not tax advice. The 2025 changes to the conditions for the eligible subsidiary are not detailed here.
Other countries
Comparison of countries for a holding company, holding company in Andorra, Luxembourg, Netherlands, Malta. Test the Andorran conditions in the holding company simulator.
Work out your own case
Free simulators, built on the official values of this page.
- Andorra vs another European country: taxes, VAT and companiesQuantify the tax gap between Andorra and 33 European countries.Open
- Simulator: cost of passive residency (no gainful activity) in AndorraRequired investment, AFA payment and non-refundable cost depending on your family.Open
- Andorran holding simulator: exemption of dividends from shareholdingsDoes your dividend meet the exemption conditions? Tax avoided and net amount kept.Open
Frequently asked questions
What is the corporate income tax rate in Ireland?
The rate is 12.5 % on trading income and 25 % on passive income.
Does an Irish holding company benefit from the low rate?
Not necessarily: passive income, often that of a holding company, is taxed at the higher rate, unless an exemption applies.
Does Pillar Two concern a small holding company?
No. It targets groups whose consolidated turnover reaches 750,000,000 €.
Going further
- Holding company: which country to choose? Comparison of 9 jurisdictions, with dated and sourced figures
- Holding company in Andorra: complete guide (taxation, exemption, setup, risks on the French side)
- Andorran holding company and the French tax authorities: 123 bis, 209 B, 238 A and effective management
Official sources
This information is general and is not personalised legal, tax or financial advice. It is verified as of the date shown and may change.