Taxes Consolidation Act 1997 section 486C

Relief from tax for certain start-up companies

Section 486C provides relief from corporation tax for new start-up companies in their early years of trading, linked to the amount of qualifying PRSI contributions paid by the company.

• A new company incorporated on or after 14 October 2008 that sets up and commences a qualifying trade between 1 January 2009 and 31 December 2026 may claim relief from corporation tax for a relevant period of five years (or three years if the trade commenced before 1 January 2018), with full relief available where total corporation tax does not exceed €40,000 and marginal relief where it falls between €40,000 and €60,000.
• The relief is linked to the amount of qualifying Employer's PRSI paid by the company (capped at €5,000 per employee or director) and, for accounting periods beginning on or after 1 January 2025, Class S PRSI remitted to Revenue on emoluments paid to self-employed directors (capped at €1,000 per individual), subject to an overall limit of €40,000 per accounting period.
• Any unused relief arising within the relevant period due to losses or insufficient profits may be carried forward as a specified aggregate and applied to reduce corporation tax referable to the qualifying trade in subsequent accounting periods, subject to the relief in any year not exceeding the total qualifying PRSI contributions for that year.
• A qualifying trade excludes a trade previously carried on by another person, an excepted trade such as dealing in or developing land, a service company trade, a trade whose activities would form part of a trade of an associated company, and certain undertakings excluded under EU de minimis aid rules; relief ceases if part of the qualifying trade is transferred to a connected person.