The 3 year Corporate and Capital Exemption scheme for start up Companies was first introduced in 2009 although the terms of the scheme were modified in the 2011 budget. The relief has the potential to enable new start-up businesses be exempt from corporation tax in each of their first 3 years provided that their tax liability in the year does not exceed €40,000 (i.e. Profits less than €320,000).
The modification in the 2011 budget limited the relief to the amount of employers PRSI paid by a Company in an accounting period, subject to a maximum of €5,000 per employee. If the amount of qualifying employers PRSI is lower than the reduction in Corporation Tax Liability otherwise applicable, relief will be based on the lower amount.
Since 2013 it is possible to carry foward any unused relief from the first 3 years of trading.
If you would like to get further information please contact us.