Shift will have limited impact on tax status and company will not physically move.
Zurich UK has confirmed its plan to redomicile from Switzerland to the Republic of Ireland, but said the move would have only a limited impact on its tax status.
The insurer is shifting its UK general insurance business into an Irish branch, to create capital efficiencies.
It is not physically moving to Ireland and the move will not have a significant impact on the amount of tax it pays. Zurich pays corporation tax in the UK and will continue to do so.
In a statement, the insurer said the decision followed a “group-wide effort to streamline its legal structure and optimise its capital management”.
The statement said: “At the moment, we have capital tied up in lots of different countries. The best way to do bring that all together is to use one carrier in one country to free up some of that regulatory capital.”
A number of insurers have expressed frustration with the British tax regime in recent months. The corporation tax rate in Ireland is 12.5%, compared to 28% in the UK. Other companies including media giant WPP have moved to Dublin this year.
Brit Insurance is currently “seriously considering” its options after Dane Douetil, Brit’s chief executive, called for greater certainty from the UK government over tax.
RSA revealed last month that it was considering redomiciling to Ireland. An RSA spokesman said the company was reviewing its domicile, but had made no decisions.
Amlin said earlier this year that it was looking into redomiciling to a more favourable tax jurisdiction such as Switzerland, Ireland or Bermuda.
Zurich will transfer all of its UK general insurance business written by Zurich Insurance Company, Zurich International, N&G and Zurich GSG to Zurich Insurance Ireland from January 1, 2009.
The insurer said the move would not involve the business relocating to Ireland. Instead it would transfer most of its UK general insurance business into the UK branch of a company regulated by the Irish Financial Regulator.
