State support for small business & SMEs in Ireland January 2014


This is a list of government funded schemes and incentives aimed at supporting small and medium sized business, published by the DEJI (Irish government Department of Jobs, Enterprise and Innovation) in January 2014.

 The list may look impressive; the schemes are aimed at different segments of the small and medium business sector. In fact few are supportive of smaller companies who have been denied loans by their banks. Financial support is aimed at “innovative” companies that wish to export.

 I have edited the document to include what is most relevant to Irish business – you can email me for the full document, or find it here customised by a TD with his photo at the front .



 Support for business

 Unemployed – Start Your Own Business:  TAX

 An exemption from Income Tax up to a maximum of €40,000 per annum will be provided for a period of two years, to individuals who set up a qualifying, un-incorporated business, having been unemployed for a period of at least 12 months prior to establishing the business.

New Frontiers Entrepreneur Development Programme TRAINING

 The national entrepreneur development programme is delivered at a local level by the Institutes of Technology. If you have an innovative business idea and are planning to establish and run your own company, the New Frontiers Entrepreneur Development Programme can provide you with a package of supports to help accelerate your business development and to equip you with the skills and contacts that you need to successfully start and grow your company. The 13 institutes can be found at .


 Capital Gains Tax Relief for Serial Entrepreneurs: TAX

 A lower rate of CGT rate will apply for anyone who invests the proceeds of disposal of assets of a business sold since 1st January 2010 into a new business during the next 5 years when the latter comes to be sold. The assets of the new business will have been held for at least 3 years. Commencement of this measure is subject to receipt of EU state-aid approval.


Seed Capital Scheme: TAX

 If you are a PAYE worker and start up and work full-time in your own company, you can get tax relief on the capital you invest in the equity of the company. The relief is a refund of the income tax you paid on an equal amount of income in any of the previous six years. The maximum investment on which relief can be claimed is €600,000.

Three Year Corporate Tax Exemption: TAX

 New companies get relief from Corporate Tax for the first three years of up to €5,000 per employee (max €40,000 Tax Credit).

The Micro-enterprise loan fund: FINANCE

 Loans of up to €25,000 are available from Micro Finance Ireland for commercially viable proposals from enterprises with no more than 10 employees that do not meet the conventional risk criteria applied by commercial banks. Borrowers will pay a commercial interest rate, (think 9%?). Call 01 2601007 or visit

Local Enterprise Office: New name for the City/County Enterprise Boards, to be located in & managed by local authorities

 Offering business mentoring, training, & grants (for feasibility studies, employment & business growth) to startups & businesses with less then 10 employees

 They are promised to be a First Stop Shop for all enterprise supports in every county and also provide the business support service of the local authority. The LEOs will draw and build on the successful County Enterprise Board (CEB) model which supports 900 new projects per annum. It will continue to offer direct access to mentoring, microfinance, grants (where appropriate) and seamless access to the wider range of EnterpriseIreland support for high potential enterprises. The LEO  for Dublin City will be based in the Wood Quay offices of Dublin City Council. There are concerns about public accessability to services in the local authority building.


 Enterprise Ireland Feasibility Study Grant: FINANCE

 Used to investigate the viability and potential of an innovative/high potential start-up and the development of an Investor Ready Business Plan.

Competitive Start Funding:  COMPETITION for FINANCE

 The Competitive Start Fund offers early stage enterprises with significant potential the opportunity to compete for an investment of €50,000 towards the start-up and market-launch process. Successful starts can graduate to the additional supports available for “High Potential Start-Ups”. Note EI takes 10% equity as a return for the €50K investment.


 Back to Work Enterprise Allowance: Scheme for unemployed starting a business

 If you have been signing on for over 12 months and you would like to become self-employed, the Back to Work Enterprise Allowance (BTWEA) allows you to keep your social welfare payment for 2 years (Year 1: 100%, Year 2:75%). To qualify, you must be setting up a business that a “Local Integrated Development Company” !!! or a Facilitator has approved in writing in advance.

Short-Term Enterprise Allowance: Scheme for unemployed starting a business

 The Short-Term Enterprise Allowance (STEA) gives support to people who have lost their job and want to start their own business. It is paid instead of Jobseeker’s Benefit for a maximum of 1 year. It ends when the entitlement to Jobseeker’s Benefit ends (that is, at either 9 months or 12 months).

CRO (Credit Review Office): bank lending mediation service

 An SME can appeal the refusal of credit by the banks involved in NAMA to this office, provided they have already used the internal review procedure of the bank. The threshold for applications that can be reviewed by the Credit Review Office is €3m. Over 55% of appeals have been found in favour of borrowers and this has resulted in €18.5M credit being made available to SMEs and farms. The Credit Review Office is not a state agency, is funded by the NAMA banks, and charges a low fee for its services. See .



Jobs Plus: Scheme to bring unemployed back to the workforce

 Gives an employer who recruits a person who has been at least 12 months out of work a €72 – per-week subsidy for 2 years provided the job is a full-time position, for a minimum of 30 hours per week and you must work at least 4 days in any 7 day period. Visit  to register online. It is proposed to reduce the threshold for JobsPlus eligibility to 6 months of unemployment for people aged under 25.

FÁS Wage Subsidy Scheme: Scheme to subsidise employment of disabled people

 Provides financial incentives to employers, outside the public sector, to employ disabled people who work more than 20 hours a week. A person on the Wage Subsidy Scheme is subject to the same conditions of employment as other employees


The Accelerated Capital Allowance (ACA) TAX

 Is a tax incentive for companies paying corporation tax and aims to encourage investment in energy efficient equipment. The ACA offers an attractive incentive whereby it allows companies to write off 100% of the purchase value of qualifying energy efficient equipment against their profit in the year of purchase.


 Momentum: Training scheme to bring unemployed back to the workforce

 Is a new programme. There are 6,500 places in programmes involving certified classroom training and work experience with a company for people who have been on the live register for 12 months or getting credits. Visit

JobBridge: On the job training scheme to bring unemployed back to the workforce

 Offers an internship of 6-9 months to persons who have been signing on as available to work and getting a payment or credits for at least 3 months. Time on completed programmes in FÁS training, back to education or a community scheme will count towards eligibility. Participants will receive €50/week on top of their welfare. Effective resourcing initiative for some SMEs. 


Credit Guarantee Scheme: FINANCE

 Companies refused credit by their bank for lacking adequate security for a normal commercial loan, or because the bank has limited understanding of the specialized aspects of the business environment in which they operate are eligible for a partial credit guarantee from the state for up to three years to help them secure the credit. The Government provides the lender with a 75% guarantee for which the borrower pays a 2% premium.


 Employment and Investment Incentive Scheme: TAX

 Allows up to €10m capital to be raised by a company for investment from private individuals, who will get personal tax relief on the investment provided they hold the investment for at least 3 years. The initial relief for individuals is 30% but up to now it has been subject to a cap for high earners. That cap is now being removed for three years so an individual will be able to invest up to the full maximum of €150,000 per annum allowed under the scheme in a growing company.

Research and Development Tax Credit: TAX

 Research and Development attracts additional tax credit of 25% which can be offset against Corporation Tax or PRSI. This credit has only applied to R and D expenditure over and above that spent in 2003. The amount of expenditure eligible for the R&D Tax Credit on a full volume basis (without reference to the 2003 base year) is being increased from €200,000 to €300,000. The limits on the amount of expenditure on R&D outsourced to third parties which can qualify for the R&D Tax Credit is being increased from 10% to 15%.


 Enterprise Ireland has a suite of Supports for Companies to develop markets:

 You have to be an Enterprise Ireland client to access publicly funded programmes

 A. Some are aimed at enterprises taking the early stages to create new opportunities or open export markets

 Potential Exports Division: EI’s Potential Exporters Division provides a wide range of initiatives focussed on helping companies export more. The ‘Get Export Ready’ programme includes practical measures for early exporters.

  • Acumen: A cross-border Business Development Programme designed to stimulate cross-border trade (between Northern Ireland and the Republic of Ireland) and develop other forms of commercial co-operation amongst SME’s throughout the island of Ireland.
  • Innovation Vouchers: Vouchers worth €5,000, are available to assist a company to work with a registered college or knowledge provider to explore a business opportunity or technical problem

 B. Enterprise Ireland also supports companies with export strategies:

 Developing a new product offering

                         Research and Development opportunities                 

                         • Entering an entirely new geographic market

                         Going Global Grant

                         Internationalisation Grant

                         New Geographic Market Research Grant

                         International Selling Programme

                                         Taking on a marketing graduate to place in-market

                          Graduates for International Growth

                        • Developing improved business processes that maximise efficiency through various “lean” initiatives

                         Lean Transform Grant

                         Lean Start Grant


Development capital scheme (225 million):  FINANCE

 Enterprise Ireland is partnering with private fund managers to create a fund targeted at growing manufacturing, technology and international trading services companies in Ireland. The main objectives of the Fund are to:

                        – Increase the availability of risk capital to established Irish companies,

                         – To close the equity gap experienced by Irish SMEs,

                         – To encourage and leverage private sector investment in the Irish economy

Through the Fund, Enterprise Ireland has up to €50m available to make commitments of up to €25m with fund managers.

The seed and venture capital schemes (700m): FINANCE

 This is a planned scheme of €175 million Seed and Venture Capital Scheme 2013-18, aimed at supporting innovative Irish SMEs. The scheme is targeting an additional €525 million in funding from the private sector, which will mean a total fund of €700 million available for investment over the lifetime of the scheme. Enterprise Ireland has recently made commitments to a number of funds in the Technology and Life Sciences Sectors. It is expected that these funds will begin to come on stream in 2014 – announcements will be made as the funds are established.


Innovation fund Ireland (250m): FINANCE

 Innovation Fund Ireland is a joint initiative between Enterprise Ireland and the NPRF and provides a unique opportunity for international venture capital fund managers to establish their European headquarters in Ireland and access entrepreneurs and innovative companies. Ireland already has an active venture capital industry and Innovation Fund Ireland is an initiative to further increase the availability of risk capital for innovative companies.

 Under the Scheme commitments have been made to a number of Funds. The following funds have been established and announced to date; DFJ Esprit, Polaris, Soffinova and Highland Capital Partners.


NPRF support funds for the SME sector (850 million): FINANCE

The National Pensions Reserve Fund, NPRF has developed a range of support funds for the SME sector to provide equity, credit and recovery investment. The NPRF will invest between €350 million and €500 million with a view to creating a total funding pool of at least €850 million for investment in SMEs.

                         BlueBay Ireland Corporate Credit I Ltd: The BlueBay fund, to which the NPRF has committed €200 million, is a €450 million credit fund that will provide loans to larger SMEs and mid-sized businesses in Ireland. BlueBay is a wholly-owned subsidiary of Royal Bank of Canada and is a specialist asset manager of fixed income credit, corporate loans and alternative products. Loan amounts are expected to range in size from €5 million to €45 million and BlueBay is able to access additional capital for situations that require larger amounts. The loans can be used by borrowers for a variety of purposes such as refinancing existing liabilities, acquisition finance or investment expenditure.

Carlyle Cardinal Ireland SME Equity Fund:

                         The Carlyle Cardinal fund, to which the NPRF has committed €125 million, is a €300 million – €350 million private equity fund that will focus on investing in healthy businesses seeking to grow, including those with overleveraged balance sheets. The fund, which has received commitments from other-third party investors, is operational and is managed by Carlyle Cardinal Ireland in Dublin. Appears to be targeted at larger SMEs and mid-sized businesses.

 Better Capital Ireland SME Turnaround Fund:

                         The Better Capital fund, to which the NPRF has committed €50 million, is a €100 million private equity fund that will invest in underperforming businesses, “distressed businesses”, which are at or close to the point of insolvency but have the potential for financial and operational restructuring. The fund is for “Irish based mid-market companies” and is operational and managed by Better Capital in Dublin.  Appears to be targeted at larger SMEs and mid-sized businesses.

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