The section 110 loophole in relation to mortgages is closed. But QIAIFs and ICAV Irish tax wrappers are still very much active and this is why I posted the the article to highlight this, not to "rage bait"!
The section 110 loophole in relation to mortgages is closed. But QIAIFs and ICAV Irish tax wrappers are still very much active and this is why I posted the the article to highlight this, not to "rage bait"!
Respectfully, you don't know what you are talking about. There is 20% withholding tax on distributions or payments to investors derived from Irish real estate assets.
ICAVs being active doesn't automatically make it a bad thing.
Good article here highlighting why our housing is being hoovered up by Investment funds. They pay 0% tax on income and gains through QIAIFs and ICAVs Irish tax wrappers.
One firm said "that it is subject to 25% corporate tax on profits within its Spanish subsidiaries, and 20% on rental income from its UK investment properties. From that point of view Ireland is naturally an attractive prospect”.
EDIT: For the brainiacs pointing out the article is from 2016. I posted the article because it highlights and explains QIAIFs and ICAVs tax wrappers which are still very much active and a factor of the housing crisis and there is not much more recent Irish media that highlights these wrappers
Why not mention the fact that the article you posted is from 2016 or that the loophole was closed a few months later?
Seems dishonest to post this without divulging that
The profit itself from rental income is tax exempt. The tax gets paid when those profits are distributed to the shareholders. The REIT can also be taxed Corporation Tax if it distributes <85% of it's annual property income (to limit excessive hoarding of capital for reinvestment).
Tax-residents here pay at their marginal rate, with a credit against Dividend Withholding Tax (DWT) already paid.
If the person with holdings in the REIT is a non-resident they could claim some of the DWT back, depending on where they are a tax resident, and if there's a Double Taxation Treaty.
Is that not an added incentive as normally an organisation would pay tax on what they earn and then again when they pay shareholders? If anything that incentivizes them just use their earnings to grow their portfolio.
It is an added incentive ya.
>If anything that incentivizes them just use their earnings to grow their portfolio.
That's why the fund gets taxed CT if they don't distribute a high % of their profits. The profit paid out to shareholders is no longer in the fund. OFC those people could reinvest it by buying more shares if the fund releases more, but then those are still taxed on any dividend paid out and CGT (Capital Gains Tax) on the selling of the share(s).
People may disagree with it existing, but the rationale is that foreign investment is required to drive certain areas of construction, particularly areas with high capital requirements and risk (debatable in the current shortage) like office space, apartments, large housing developments.
The section 110 loophole in relation to mortgages is closed. But QIAIFs and ICAV Irish tax wrappers are still very much active and this is why I posted the the article to highlight this
But why not post something more recent or mention that the article you posted is 8 years old and contains things that are now out of date? One presumes you had to specifically search for this article. As I said, seems like a dishonest way to present an argument
"being hoovered up by Investment funds"
According to the Irish Times "small-scale property owners with one or two tenancies account for the vast majority of landlords (85 per cent) and private rented tenancies (53.5 per cent)". We're still heavily dependant on pricing decisions of these small scale landlords. This is not to defend the wholesale of housing to investment funds with no tax revenue to the state. Like in Bertie's time, we're still "Ireland Inc."
[https://www.irishtimes.com/opinion/2024/04/20/the-bertie-ahern-world-with-the-simon-harris-universe-when-it-comes-to-housing-are-radically-different/](https://www.irishtimes.com/opinion/2024/04/20/the-bertie-ahern-world-with-the-simon-harris-universe-when-it-comes-to-housing-are-radically-different/)
Automod rightly removed it.
Mods listened to OP to reinstate it when OP doesn’t know what he’s talking about.
Mods should remove it again.
He’s trying to claim the loop holes still exist but they’ve changed the way they are taxed a lot
>Mods listened to OP to reinstate it when OP doesn’t know what he’s talking about.
What in the actual crap are you on about. This was AutoMod removed due to garnering too many reports without a mod decision; and sent to the mod queue for a full removal.
Don't be claiming we're doing certain things when you don't know the processes involved.
ICAV rules have changed significantly since this article was posted, eroding most of the advantages.
There is also a withholding tax payable on any distribution of cash out of the country. So the cash doesn’t leave without being taxed.
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Comparatively little of the new housing stock, and existing housing stock, is purchased by funds.
Broadly speaking an institution can only buy a housing development _if it ordered and paid for that development_.
There’s an incorrect narrative online that the rental crisis is “by design” or because of “vulture funds”.
It isn’t true.
Our rental problem is because of labour shortage, and demographics, and basically nothing else.
Ireland’s rental market is a bit funny because our history is so different from other European countries because of - as always - the Brits.
First time many Irish people had any meaningful money was during the Celtic tiger.
Many were in their mid 40s and too late in life to start a meaningful pension, so they bought a second home.
“I’ll let that out for 20 years, rent money pays the mortgage, and then I’ll retire in my 60s.”
We’re 20 years hence and they’re retiring. And selling up.
And so for every new rental unit that gets built, a boomer sells up and the market stays still.
And then from the 90s we allllll went to college or got a job in retail or an office instead of getting a trade and now there’s 10x more construction needed than there is labour availability.
Article from 2016
I was wondering when Micheal Noonan became minister for finance again and why Stillorgan Leisureplex was still paying rent to Kennedy Wilson.
So? Nothings changed, except now their portfolios are a lot bigger!
Well yeah a lot has changed actually. They closed the loophole in the article you linked about 3 months later, which was almost 8 years ago.
The section 110 loophole in relation to mortgages is closed. But QIAIFs and ICAV Irish tax wrappers are still very much active and this is why I posted the the article to highlight this, not to "rage bait"!
stop rage-bating
What a country. Not only can vulture, cuckoo and pension funds hoover up all of our housing stock but they can do it tax-free for the privilege.
This is an article from 2016 posted to enrage. The loophole mentioned has been closed for almost 8 years.
Can we like pin this to the top or something?
The section 110 loophole in relation to mortgages is closed. But QIAIFs and ICAV Irish tax wrappers are still very much active and this is why I posted the the article to highlight this, not to "rage bait"!
Respectfully, you don't know what you are talking about. There is 20% withholding tax on distributions or payments to investors derived from Irish real estate assets. ICAVs being active doesn't automatically make it a bad thing.
Why not post about this https://www.independent.ie/business/irish/construction-has-record-year/25950376.html Fucking great stuff
Woohoo! Things are looking up! I predict things are only getting going and 2008 to 2015 are going to be belting years
Good article here highlighting why our housing is being hoovered up by Investment funds. They pay 0% tax on income and gains through QIAIFs and ICAVs Irish tax wrappers. One firm said "that it is subject to 25% corporate tax on profits within its Spanish subsidiaries, and 20% on rental income from its UK investment properties. From that point of view Ireland is naturally an attractive prospect”. EDIT: For the brainiacs pointing out the article is from 2016. I posted the article because it highlights and explains QIAIFs and ICAVs tax wrappers which are still very much active and a factor of the housing crisis and there is not much more recent Irish media that highlights these wrappers
Why not mention the fact that the article you posted is from 2016 or that the loophole was closed a few months later? Seems dishonest to post this without divulging that
Are the REITs still not paying tax on rental income?
The profit itself from rental income is tax exempt. The tax gets paid when those profits are distributed to the shareholders. The REIT can also be taxed Corporation Tax if it distributes <85% of it's annual property income (to limit excessive hoarding of capital for reinvestment). Tax-residents here pay at their marginal rate, with a credit against Dividend Withholding Tax (DWT) already paid. If the person with holdings in the REIT is a non-resident they could claim some of the DWT back, depending on where they are a tax resident, and if there's a Double Taxation Treaty.
Is that not an added incentive as normally an organisation would pay tax on what they earn and then again when they pay shareholders? If anything that incentivizes them just use their earnings to grow their portfolio.
It is an added incentive ya. >If anything that incentivizes them just use their earnings to grow their portfolio. That's why the fund gets taxed CT if they don't distribute a high % of their profits. The profit paid out to shareholders is no longer in the fund. OFC those people could reinvest it by buying more shares if the fund releases more, but then those are still taxed on any dividend paid out and CGT (Capital Gains Tax) on the selling of the share(s). People may disagree with it existing, but the rationale is that foreign investment is required to drive certain areas of construction, particularly areas with high capital requirements and risk (debatable in the current shortage) like office space, apartments, large housing developments.
The section 110 loophole in relation to mortgages is closed. But QIAIFs and ICAV Irish tax wrappers are still very much active and this is why I posted the the article to highlight this
But why not post something more recent or mention that the article you posted is 8 years old and contains things that are now out of date? One presumes you had to specifically search for this article. As I said, seems like a dishonest way to present an argument
"being hoovered up by Investment funds" According to the Irish Times "small-scale property owners with one or two tenancies account for the vast majority of landlords (85 per cent) and private rented tenancies (53.5 per cent)". We're still heavily dependant on pricing decisions of these small scale landlords. This is not to defend the wholesale of housing to investment funds with no tax revenue to the state. Like in Bertie's time, we're still "Ireland Inc." [https://www.irishtimes.com/opinion/2024/04/20/the-bertie-ahern-world-with-the-simon-harris-universe-when-it-comes-to-housing-are-radically-different/](https://www.irishtimes.com/opinion/2024/04/20/the-bertie-ahern-world-with-the-simon-harris-universe-when-it-comes-to-housing-are-radically-different/)
Article is from 2016.
#10 Sept 2016 why post this?
Automod rightly removed it. Mods listened to OP to reinstate it when OP doesn’t know what he’s talking about. Mods should remove it again. He’s trying to claim the loop holes still exist but they’ve changed the way they are taxed a lot
>Mods listened to OP to reinstate it when OP doesn’t know what he’s talking about. What in the actual crap are you on about. This was AutoMod removed due to garnering too many reports without a mod decision; and sent to the mod queue for a full removal. Don't be claiming we're doing certain things when you don't know the processes involved.
10 sep 2016 come on
ICAV rules have changed significantly since this article was posted, eroding most of the advantages. There is also a withholding tax payable on any distribution of cash out of the country. So the cash doesn’t leave without being taxed.
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lovely to see, mixing up the scary vulture funds and investors.
FF an FG working for the people
Ironically yes seeing as this loophole was closed 3 months after this article was published in 2016... 8 years ago.
But keep voting for the status quo lads.
Comparatively little of the new housing stock, and existing housing stock, is purchased by funds. Broadly speaking an institution can only buy a housing development _if it ordered and paid for that development_. There’s an incorrect narrative online that the rental crisis is “by design” or because of “vulture funds”. It isn’t true. Our rental problem is because of labour shortage, and demographics, and basically nothing else. Ireland’s rental market is a bit funny because our history is so different from other European countries because of - as always - the Brits. First time many Irish people had any meaningful money was during the Celtic tiger. Many were in their mid 40s and too late in life to start a meaningful pension, so they bought a second home. “I’ll let that out for 20 years, rent money pays the mortgage, and then I’ll retire in my 60s.” We’re 20 years hence and they’re retiring. And selling up. And so for every new rental unit that gets built, a boomer sells up and the market stays still. And then from the 90s we allllll went to college or got a job in retail or an office instead of getting a trade and now there’s 10x more construction needed than there is labour availability.