Designated Activity Company (DAC)
Cuideachta Ghníomhaíochta Ainmnithe
Company formation in Ireland
The DAC is best suited for: Regulated financial services entities (banks, insurers, fund administrators), Joint ventures where activity scope must be contractually limited, Special purpose vehicles (SPVs) for securitisation or project finance, Companies required by a regulator to have a defined objects clause, Charities and not-for-profits that need a guarantee structure. Taxed identically to an Ltd company. Trading income is subject to the 12.5% corporation tax rate and non-trading income to the 25% rate. DACs used as SPVs in securitisation transactions can qualify for Section 110 treatment, where taxable profits may be reduced to near zero through the deductibility of profit-participating notes. The same R&D tax credit (25%), Knowledge Development Box (6.25% effective rate), and EU directive benefits apply. DACs in regulated financial services may also benefit from specific reliefs for qualifying fund management and aircraft leasing activities.
- Regulated financial services entities (banks, insurers, fund administrators)
- Joint ventures where activity scope must be contractually limited
- Special purpose vehicles (SPVs) for securitisation or project finance
- Companies required by a regulator to have a defined objects clause
- Charities and not-for-profits that need a guarantee structure
Key Facts
Step-by-Step Formation Process
Reserve company name
Check name availability through the CRO and reserve your company name. DAC companies must include "Designated Activity Company" or "DAC" in their name.
Prepare a memorandum and articles of association
Unlike the Ltd, a DAC retains the traditional two-document constitution: a memorandum of association (which includes a defined objects clause restricting activities) and articles of association (governing internal procedures). The objects clause is the distinguishing feature of a DAC.
File Form A1 with the CRO
Submit the incorporation form along with the memorandum and articles. The form must include details of at least two directors, a company secretary, the registered office, and share capital information.
Receive Certificate of Incorporation
The CRO processes the application and issues the Certificate of Incorporation upon approval. Processing may take slightly longer than an Ltd due to review of the objects clause.
Register for tax with Revenue
Register with the Revenue Commissioners for Corporation Tax, VAT, and employer taxes via ROS. Regulated entities may also need to register with the Central Bank of Ireland.
Open a corporate bank account
Provide the Certificate of Incorporation, memorandum and articles, director IDs, and (for regulated entities) Central Bank authorisation documentation to your chosen bank.
Required Documents
- Form A1 (incorporation form)
- Memorandum of association (with objects clause)
- Articles of association
- Proof of registered office address in Ireland
- Director identification (passport or national ID) for at least two directors
- Director proof of address for each director
- Company secretary details
- Consent to act as director (signed by each director)
Cost Overview
Tax Treatment
Taxed identically to an Ltd company. Trading income is subject to the 12.5% corporation tax rate and non-trading income to the 25% rate. DACs used as SPVs in securitisation transactions can qualify for Section 110 treatment, where taxable profits may be reduced to near zero through the deductibility of profit-participating notes. The same R&D tax credit (25%), Knowledge Development Box (6.25% effective rate), and EU directive benefits apply. DACs in regulated financial services may also benefit from specific reliefs for qualifying fund management and aircraft leasing activities.
Pros & Cons
- Objects clause provides legal certainty to counterparties about the company's permitted activities
- Preferred by the Central Bank of Ireland for regulated financial services entities
- Can issue debentures and debt securities to the public
- Well understood by institutional investors and lenders in structured finance
- Suitable for ring-fencing specific activities in a corporate group
- Same 12.5% trading tax rate as an Ltd
- Requires a minimum of two directors at all times
- Must appoint a company secretary
- More complex two-document constitution to maintain
- Ultra vires doctrine applies — acts outside the objects clause may be void
- Slightly higher formation and ongoing compliance costs
- Less flexible than an Ltd for companies that may pivot their business model
Other Structures in Ireland
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Get StartedThis content is educational and does not constitute legal or tax advice. Always consult a qualified professional for your specific situation. Data last verified March 2026.