Intercompany Reimbursement Agreement Template for Ireland

An Intercompany Reimbursement Agreement is a critical legal document that formalises cost-sharing arrangements between related companies within a corporate group operating in Ireland. This agreement establishes the framework for one entity to recover expenses it has incurred on behalf of another group company, ensuring transparency, compliance, and proper financial governance across your organisation.

When do you need this document?

You need an Intercompany Reimbursement Agreement when your Irish subsidiary shares services, facilities, or resources with other group entities. This typically occurs when your parent company provides centralised functions like IT support, human resources, or administrative services to subsidiaries, or when one operating company incurs expenses that benefit multiple group entities. The agreement is essential when your holding company pays for shared office space, legal fees, or professional services that benefit several subsidiaries, or when your service company provides specialised functions across the group structure. Without this formal agreement, cost allocations may face scrutiny from Revenue Commissioners and could impact your corporate governance compliance.

Key legal considerations

Your agreement must demonstrate that reimbursement arrangements reflect genuine commercial transactions at arm's length prices, as required under Irish transfer pricing rules. You need to clearly define the scope of reimbursable costs, ensuring they relate to legitimate business expenses that provide identifiable benefits to the receiving entity. The calculation methodology must be transparent and defensible, typically based on objective allocation keys such as headcount, revenue, or usage metrics. Your agreement should include robust documentation requirements to support each reimbursement claim, as Irish tax authorities expect detailed records of intercompany transactions. Directors must ensure that any reimbursement arrangements serve the best interests of each company involved and comply with their fiduciary duties under the Companies Act 2014.

Legal requirements in Ireland

Under the Companies Act 2014, your Intercompany Reimbursement Agreement must be properly authorised by the boards of all participating companies, particularly where transactions involve connected persons or could constitute substantial property transactions. You must comply with Irish transfer pricing documentation requirements introduced in 2020, maintaining contemporaneous records that demonstrate the arm's length nature of your cost allocations. Revenue Commissioners require that intercompany pricing methodologies align with OECD guidelines and reflect what independent parties would agree under comparable circumstances. Your agreement must also consider IFRS reporting requirements if your companies prepare consolidated financial statements, ensuring proper elimination of intercompany balances and transparent disclosure of related party transactions. Additionally, if personal data is processed as part of cost allocation procedures, you must ensure GDPR compliance in your documentation and data handling processes.