Friday 15 December 2017

Rory McIlroy spurns havens and sets up shop in Ireland for tax affairs

Rory McIIroy
Rory McIIroy

World No1 golfer Rory McIlroy is shifting most of his operations to Dublin as he seeks to simplify the way his management company operates.

The decision will mean a significant boost to the Exchequer as the golfer will pay normal company tax at 12.5pc on his royalty fees - which are expected to amount to hundreds of millions of euros over his career.

The Herald understands McIlroy, who is currently the world's top golfer, will file documents to create a new company known as Rory McIlroy Inc with the Companies Registration Office in Carlow today.

The new company, headed by Donal Casey, will manage all the royalty payments from the golf star's various endorsements for Nike sportswear, Omega watches and computer games.

The 25-year-old lives and works in many countries, and could have followed the usual route of creating a complex structure that would have located his management company in the United States while protecting his wealth with tax havens such as the Virgin Islands or Bermuda.

Instead, he has decided to locate everything to do with his brand and intellectual property in Ireland.

Prize money and other such earnings will not be part of the Irish company's revenue because they tend to be treated as income, and taxed accordingly by the country where the championship was won.

McIlroy ended his relationship with his previous sports management company Horizon Sports Management following a sometimes bitter legal action in the Four Courts.

While McIlroy's new company draws income from endorsements all over the world, it is relatively small.

It employs just six people in management and a further four people in administration.

It also uses many experts here such as accountancy firm BDO and award-winning advertising agency Rothco.

Sports management has been around for decades, but McIlroy is undoubtedly the Irish sportsman with the greatest ever potential to become a billionaire.

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