RSM Ireland

SELLING AND TRANSFERRING IRISH REAL ESTATE

DIRECT SALE OF REAL ESTATE

Resident individual

Losses

Losses in any year are set off against chargeable gains arising in the same year. Unused losses may be carried forward indefinitely. Capital losses cannot generally be carried back. Gains on development land may only be offset by losses on development land.

Non-resident individual

Non-resident individuals are treated in the same manner as resident individuals.

Resident company

VAT / transfer tax

The same rules as for individuals apply.

Losses

The same rules as for individuals apply.

Non-resident company

Capital gains

Non-resident companies are subject to capital gains tax on chargeable gains made on the disposals of specified Irish Assets.

Liability to tax

Irish land and buildings are regarded as specified Irish Assets for capital gains tax purposes. Where a non-resident company disposes of specified Irish assets it will be subject to 33% capital gains tax on any gain on the disposal.

VAT / transfer tax

The same rules as for individuals apply.

Losses

The same rules as for individuals apply.

INDIRECT SALE

Resident individuals

Losses

Same as for Direct sale as above.

Non-resident individual

Capital gains

The same rules as for companies apply.
Resident company

Capital gains

Companies pay capital gains tax on the sale of shares in the normal manner. The current capital tax rate is 33% on chargeable gains.

Exemptions

The Irish tax legislation provides for an exemption from tax in the case of certain capital gains from the disposal of holdings in subsidiaries.

Certain conditions must be met before a gain can be exempt.

  • First, the investor company must have a minimum shareholding in the investee company.
    The investor is required to have a minimum holding of at least 5 per cent in the investee company for a continuous period of at least 12 months in the 3 years prior to the disposal.
  • Second, the investee company must carry on a trade, or the business of the investor company, its investee company and their ‘5 per cent’ investee companies, taken as a whole, must consist wholly or mainly of the carrying on of a trade or trades.
  • Finally, at the time of the disposal the investee company must be resident in an EU Member State, a territory with which Ireland has a double tax treaty in force or a territory with which Ireland has signed a double tax treaty which has yet to come into force.

The exemption does not apply to shares which derive the greater part of their value from land
in the State and as such the availability of the relief in relation to companies holding Irish real estate
will be limited.

VAT / transfer tax

The same rules as for individuals apply.

Losses

The same rules as for individuals apply.
Non-resident company

Capital gains

Non- resident companies are subject to capital gains tax on chargeable gains made on the disposals of specified Irish Assets which include the following:

  • land, buildings situated in Ireland
  • unquoted shares in a company deriving the greater part of their value from Irish
    land or buildings
  • capital assets used for the purpose of a trade carried on in Ireland

Where a non-resident company disposes of specified Irish assets it will be subject to 33% capital gains tax on any gain on the disposal.

VAT / transfer tax

The same rules as for individuals applies.

Losses

The same rules as for individuals applies.

DIRECT TRANSFER INTRA CONCERN (IRISH REAL ESTATE TO IRISH COMPANY)

Same as for direct sale for companies as above.

INDIRECT TRANSFER INTRA CONCERN (IRISH REAL ESTATE TO IRISH COMPANY)

Same as for indirect sale for companies as above.

DIRECT TRANSFER INTRA CONCERN (IRISH REAL ESTATE TO FOREIGN COMPANY)

Same as for Direct sale for companies as above.

INDIRECT TRANSFER INTRA CONCERN (IRISH REAL ESTATE TO FOREIGN COMPANY)

Same as for indirect sale for companies as above.

TRANSFER IRISH REAL ESTATE TO AN EU-COMPANY

Same as for indirect and direct sales for companies as above.

This report has been produced in conjunction with Nyenrode Business Universiteit

 

RSM is the brand used by a network of independent accounting and consulting firms, each of which practices in its own right. The network is not itself a separate legal entity of any description in any jurisdiction. The network is administered by RSM International Limited, a company registered in England and Wales (company number 4040598) whose registered office is at 50 Cannon Street, London EC4N 6JJ. ­The brand and trademark RSM and other intellectual property rights used by members of the network are owned by RSM International Association, an association governed by article 60 et seq of the Civil Code of Switzerland whose seat is in Zug.

© RSM International Association, 2019

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