Dáil Éireann Debate, Thursday - 22 January 2026
315. Deputy Pearse Doherty asked the Tánaiste and Minister for Finance further to Parliamentary to Question No. 227 of 18 December 2025, if he is concerned by the very low level of tax being paid by legal structures profiting from Irish property (details supplied); and if he will make a statement on the matter. [5182/26]
View answerAs highlighted in my response to a recent question from the Deputy, the IREF regime is predominantly a withholding tax regime that applies to an Irish fund where 25 per cent or more of the value of the assets in a fund is derived from Irish property such as land and buildings. Where the profits of the IREF are transferred to certain investors, the IREF is required to apply IREF withholding tax (IREF WHT) at a rate of 20 per cent.
There are exemptions from IREF WHT for certain Irish and non-resident investors, for example, for collective, widely held investments where an investor is a domestic or EU/EEA equivalent pension scheme, investment fund or a life assurance company. These exemptions are in line with international taxing norms for such investors and are necessary to prevent double taxation in the hands of the ultimate individual investor.
While these exemptions from IREF WHT have limited the impact of the regime from a tax yield perspective, it is nonetheless a policy objective to allow exempt investors to invest in Irish property in a way that does not give rise to double taxation.
I note the Deputy has quoted the Funds Sector 2030 report, which estimates that IREFs hold €28 billion in Irish property including €8 billion in residential property.
Based on the latest data available from Revenue, I understand approximately €27.4 billion of Irish property assets were held by IREFs for accounting periods ending in 2024, of which roughly €8.6bn was residential. Each year, Revenue publishes analysis of payments and returns including details of statistical data on IREFs, see link below.
(www.revenue.ie/en/corporate/documents/research/ct-analysis-2025.pdf).
As a general comment in relation to IREF WHT receipts, I understand a number of factors influence total receipts year-to-year. I am informed by Revenue that several IREFs report realised and unrealised losses, particularly in the commercial and retail property sectors, due to market fluctuations. These losses reduce the profits available for distribution to investors and result in fewer taxable events, which in turn lowers the amount of IREF WHT receipts. There are also other reasons for fluctuations in IREF WHT receipts such as the frequency of IREF taxable events. In addition, market dynamics play a role in shaping IREF WHT receipts, for example, some IREFs may have exited the market, restructured their holdings or disposed of assets in recent years.
