Double Irish With A Dutch Sandwich

Posted in Finance, Accounting and Economics Terms, Total Reads: 456
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Definition: Double Irish With A Dutch Sandwich

A tax evasion technique used by various large multinational companies which involves the usage of Dutch and Irish subsidiary companies for shifting profits to no or low tax jurisdiction. This involves profits being sent first through an Irish company followed by a Dutch company and then back again through an Irish company whose headquarters are located in a tax haven.


It is part of a class of tax avoidance methods where transactions are arranged between subsidiary companies such that they take advantage of the varying, unique tax codes of various countries. They are usually used prominently by companies which can shift part of their profits to other countries by appropriating them as intellectual rights to their abroad located subsidiaries, for example- technology companies.


Apple Inc. was a pioneer in adopting this tax structure in late 1980s.This is possible because the Irish tax code does not include transfer pricing rules as mentioned in US tax codes. In fact, territorial taxation is followed in Ireland which implies that taxes are not levied on incomes earned and booked in subsidiary companies of an Irish company located outside. Other major companies following this tax structure are – Facebook, Microsoft, Yahoo, Eli Lilly, Oracle Corp. Etc.

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