Section 110 companies in Ireland: key tax benefits, uses and qualifying criteria

Ireland has seen a recent surge in the use of Section 110 companies, especially in structured finance, securitisation, credit platforms and aviation leasing and financing structures.

So, what is driving the special purpose vehicle’s surge in popularity, and how do Section 110 companies help achieve tax neutrality?

In this article, Ogier's Tax team in Ireland outlines the key features, benefits and requirements of Section 110 companies, highlighting why they remain a preferred vehicle for sophisticated cross-border finance transactions.

What is a Section 110 company?

A Section 110 company is an Irish‑resident special purpose vehicle (SPV) that qualifies for the regime set out in Section 110 of the Taxes Consolidation Act 1997.

Where the relevant conditions are met, the company is taxed in a manner intended to produce a broadly tax‑neutral outcome, aligning taxable profits with economic profit.

Section 110 companies are commonly used in structured finance, securitisation, credit platforms and aviation leasing and financing structures, and are widely recognised by investors, rating agencies and counterparties.

SPVs in Ireland rose by 26% in last two years, according to the Irish Debt Securities Association (IDSA). The total number of Irish SPVs grew by 12.6%, including Section 110 companies which rose by 26.0% and Irish fund-linked SPVs increased by 16.6%.

Key tax benefits of a Section 110 company

Tax neutrality

The principal attraction of the Section 110 regime is the ability to achieve tax neutrality at the level of the Irish SPV. This is typically achieved through the deduction of profit‑participating funding costs, ensuring that the company’s Irish taxable profits broadly equate to a minimal retained margin.

As an Irish‑resident company, SPVs may benefit from Ireland’s well established corporation tax framework, while allowing economic returns to flow through to investors in a tax‑efficient manner.

Broad asset eligibility

A Section 110 company may hold a wide range of qualifying assets, including:

• financial assets such as loans, receivables and securities

• assets capable of producing qualifying profits, including aircraft and aviation‑related assets

• residual interests and other structured finance instruments

This flexibility makes Section 110 companies particularly attractive for complex, cross‑border financing and aviation structures.

Efficient deductibility of funding costs

Profit‑dependent or profit‑participating interest on funding instruments can be deductible for Irish tax purposes, provided specific statutory conditions are satisfied. This allows structuring flexibility while maintaining a low Irish tax profile for the SPV.

The regime is therefore well suited to capital markets issuances, private credit platforms and aviation financing arrangements, where returns to investors are often linked to performance.

Extensive treaty network and EU access

As an Irish‑resident entity, a Section 110 company may benefit from Ireland’s extensive double tax treaty network, subject to the relevant conditions being met. Additionally, Ireland’s EU membership provides access to EU directives and a stable legal and regulatory environment, which is particularly important for international investors and arrangers.

Legal certainty and regulatory credibility

Ireland has a long‑established and internationally recognised track record in structured finance. Section 110 companies are widely understood by rating agencies, institutional investors and regulatory authorities, offering a level of legal and tax certainty that is highly valued in cross‑border transactions.

Ireland has one of the largest and most established SPV markets globally. According to analysis published by the IDSA, there were approximately 3,861 active Irish SPVs at year‑end 2025, with an estimated aggregate asset value of €1.254 trillion. These vehicles largely operate under the Section 110 regime and related SPV frameworks. Irish Section 110 companies are used across a broad range of financial services and asset‑backed industries, with their application evolving over time.

Key requirements to qualify as a Section 110 company

To access the Section 110 regime, a company must satisfy a number of statutory conditions.

Irish tax residence

The company must be tax resident in Ireland, typically achieved through Irish central management and control and a majority of Irish‑resident directors.

Qualifying company

The entity must be a qualifying company, meaning it:

• carries on a business of holding and managing qualifying assets

• was incorporated for the purposes of that business

• acquires qualifying assets of a market value of at least €10 million on the first day it holds such assets

Qualifying assets

The company must hold qualifying assets, which are broadly defined and include financial assets, receivables, securities and certain tangible assets such as aircraft, provided they generate qualifying income.

Arm’s-length and commerciality requirements

Transactions entered into by the Section 110 company must be on arm’s length, commercial terms. In particular, funding arrangements must be structured carefully to ensure deductibility while complying with Irish tax rules and anti‑avoidance provisions.

Compliance and reporting obligations

As an Irish company, a Section 110 vehicle is subject to:

• Irish corporation tax filing obligations

• Irish accounting and audit requirements

• company law compliance under the Companies Act 2014

Appropriate governance, substance and documentation are therefore essential.

Ongoing considerations

While the Section 110 regime remains a powerful structuring tool, careful attention must be paid to ongoing compliance, anti‑avoidance provisions and evolving international tax standards. Structures should be reviewed regularly to ensure continued alignment with both Irish law and broader international tax developments.

Key takeaways

From an Irish tax perspective, Section 110 companies continue to offer a highly efficient, flexible and internationally respected platform for structured finance and aviation finance transactions. When properly structured and managed, they provide tax neutrality, legal certainty and commercial credibility within an EU framework.

Given their complexity, early engagement and tailored advice are critical to ensuring that a Section 110 structure meets both commercial objectives and regulatory requirements.

How Ogier can help

Our Structured Finance team in Ireland provides commercially driven, solutions-based advice to clients executing debt capital markets and structured finance transactions in and from Ireland.

We draw on expertise from our Tax, Investment Funds and Regulatory teams, and work closely with Ogier Global's corporate and fiduciary professionals to support clients with the formation and administration of asset finance, debt issuance and securitisation vehicles.

For more information on our offering, contact John Perry via the details provided below.

About Ogier

Ogier is a professional services firm with the knowledge and expertise to handle the most demanding and complex transactions and provide expert, efficient and cost-effective services to all our clients. We regularly win awards for the quality of our client service, our work and our people.

Disclaimer

This client briefing has been prepared for clients and professional associates of Ogier. The information and expressions of opinion which it contains are not intended to be a comprehensive study or to provide legal advice and should not be treated as a substitute for specific advice concerning individual situations.

Regulatory information can be found under Legal Notice