Britain's corporation tax rate is more than double that of Ireland's and WPP made the decision to move after the Treasury announced plans to raise money by taxing the foreign profits of international companies.
WPP paid £204m in British taxes in its previous financial year, despite almost 90% of its revenues being generated outside of the UK.
The group behind ad agencies Young & Rubicam and JWT, and media agencies MediaCom and Mindshare, has reduced its effective tax rate from 31.2% in 2008 to 23.5% in 2009.
A financial specialist highlighted that the estimated £50m tax savings may not just be a result of the move alone, as some savings were possibly made following "currency fluctuations that would apply to most international companies".
WPP published its preliminary results for 2009 last week, recording a 16% drop in profits to £812m during what it labelled a "brutal" year for the agency network.
Sorrell has previously said the group's board felt it had to make the move to Ireland "in the interests of shareholders".
A WPP spokesman told Media Week: "It's just not appropriate to put a figure against inversion. We made the move because it makes the tax planning process much easier. You don't have to deal with the British Treasury trying to tax any of your foreign profits."
It marked the first time the UK Government's buying business for all its departmental advertising campaigns had been consolidated into one group, which last year accounted for £250m.
Two years ago Sorrell was awarded the Freedom of the City of London, an honour previously bestowed upon Princess Diana, Nelson Mandela and Winston Churchill.
This article was first published on mediaweek.co.uk
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