A new 20pc tax on profits will hit so called vulture funds and other investor holding Irish property assets through previously low tax vehicles from the start of next year.
The new 20pc withholding tax must be held back by fund managers before profits are distributed to investors, and therefore will be paid regardless of where a fund owners are based. It brings the tax treatment of foreign funds into line with Irish investors. The new rules don’t apply to certain investor classes, including pension and insurance funds.
The move to beef up taxes on property income follows public disquiet at the tax-free profits being generated by mostly big US funds that bought assets here at knockdown prices in the Crash.
The new tax regime will apply to structures that have been used by those investors to cut their taxes, in some cases to nothing, including qualifying investor alternative investment funds (QIAIFs), Irish collective asset management vehicles (Icavs) as well as so-called Section 110 companies. It follows a move in September to restrict the use of Section 110 companies, which were originally developed for so called securitization deals.
The new tax will apply to any fund where Irish property assets account for 25pc or more its total assets.
The idea is to levy the tax on Irish income generated by the assets regardless of where the owners are domiciled.
Article Source: http://tinyurl.com/kbwqb42
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- 15 Feb 2019On the money: Ireland’s minimum wage is now the second highest of all EU countries
- 15 Feb 2019Higher rents and utility bills push consumer prices up
- 15 Feb 2019Property prices still rising – but easing rate of increase indicates slight cooling down
- 15 Feb 2019€647m paid out to 39,800 affected tracker mortgage customers
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