I propose to take Questions Nos. 156 and 158 together.
The Irish Real Estate Fund (IREF) regime was introduced by Finance Act 2016. In general terms, the regime provides that profits arising to Irish funds from Irish property remain within the charge to Irish tax. An IREF is an investment undertaking where 25 per cent or more of the value of the assets of the undertakings is derived from real estate assets in the State. Where a unit holder receives value from the IREF, an IREF withholding tax of 20% will generally apply. There are a number of exceptions from the operation of this withholding tax such as for pension schemes and charities as they are more generally exempt from tax.
On introduction, the IREF regime provided for an exemption from IREF withholding tax on the distribution of profits that arose from holding Irish land or buildings for more than 5 years. Finance Act 2017 introduced legislation to remove the CGT exemption within the IREF regime from 1 Jan 2019. This amendment was not revenue raising in nature, but designed to ensure that tax provisions did not encourage land hoarding.
The first payment of IREF withholding tax and the filing date for the first return for the majority of these funds is 30 July 2018. At that point, depending on the number of IREFs, it may be possible to identify the quantum of profits from long term land holdings that were distributed during 2017.
However, I am advised by Revenue that information in relation to the potential sale of property held by an IREF or future distributions made by IREFs is not available to enable an accurate estimate of the potential revenue from the changes mentioned by the Deputy.