Ireland benefits from UK exodus, but don't expect too many jobs

The Emerald Isle is being eyed by UK financial services firms looking to cut costs and escape Britain's "uncompetitive" tax regime. But don't pop the champagne corks in anticipation of a flood of jobs: the chances are that the majority of the workforce will be staying put.

Fund manager Henderson Group announced it is due to relocate its headquarters to Ireland to "help protect" its tax position and thinks others will follow in its footsteps.

Roger Yates, chief exec of the firm, said: "It is now a valid question for shareholders to ask companies if it is possible to mitigate the tax rate via a change of domicile." (Belfast Telegraph)

Still, 750 of Henderson's staff currently based in London are expected to remain there, which is a clear signal that moving the headquarters doesn't necessarily mean bringing the staff with you.

John Whiting, tax partner at PricewaterhouseCoopers, says: "You could expect anything from 5-100% of the operation to move. It could be that just the core management and directors would relocate, or if the skills base is there they could look to the local market, or just move the entire firm across. There's no hard-and-fast rule."

Chris Sanger, head of tax policy at Ernst & Young, predicts it will be the Henderson top brass making the move, but there could be fringe benefits for the Irish market: "The key decision-makers will be in Ireland and when they want advice on company strategy, they are likely to look to the local market."

Brit Insurance is also currently pondering a move to Ireland. Sanger says the exodus of companies is down to being pushed out of the UK rather than pulled to Ireland. "I would expect to see a continued drip of companies who are concerned about UK tax policy make the move," he adds.