All material subject to strictly enforced copyright laws. © 2022 ITR is part of the Euromoney Institutional Investor PLC group.

Ireland: Ireland introduces REITs


Gerry Thornton

Ireland has introduced legislation facilitating the establishment of real estate investment trusts (REITs) in Ireland. Irish REITs will be established as listed companies (as opposed to trusts) and will hold rented investment properties. They will not be subject to the regulatory provisions which apply to Irish regulated funds. Provided a number of conditions are satisfied, REITs will be exempt from corporate tax.

Main conditions

The Irish REIT legislation is modelled on the equivalent UK legislation, though there are some differences. The main conditions which must be satisfied for an Irish REIT are as follows:

  • The REIT must be a company incorporated under Irish law and must be tax resident only in Ireland.

  • The REIT must list its shares on the main market of a recognised stock exchange in an EU member state.

  • Generally, the REIT must not be a closely-held company. However, there are exceptions if the REIT is controlled by Irish pension schemes, Irish regulated funds and other specified Irish entities.

  • The REIT must carry on a property rental business comprising at least three properties. These may be within or outside Ireland. None of the properties may individually account for more than 40% of the total market value of all of the properties.

  • The REIT must derive at least 75% of profits from carrying on a property rental business.

  • The REIT must distribute at least 85% of its property income by dividend to shareholders in each accounting period.

  • The REIT must maintain an income to finance costs ratio of 1.25:1.

  • The REIT must ensure that its debt does not exceed 50% of the aggregate market value of its assets.

A number of these conditions are subject to a three year grace period.

Tax treatment of the REIT

A REIT will generally be exempt from Irish tax on its income and gains from its property rental business. However, any income or gains arising from residual (non-property rental) business will be subject to Irish tax. Similarly, any profits attributable to the material development of property will be taxable (if the cost of the development exceeds 30% of its previous market value). Finally, if one shareholder holds more than 10% of the shares of the REIT, the REIT can be subject to tax when it makes distributions to such shareholder.

Tax treatment of foreign investors

Investors will be subject to 20% withholding tax on distributions from the REIT (though Ireland's tax treaty network of 68 treaties may enable investors to reclaim some or all of such withholding tax). Foreign investors should be exempt from Irish capital gains tax on any disposal of their shares in the REIT. One percent stamp duty will be payable on a transfer of shares in a REIT.

Conversion of existing companies into REITs

It is possible for existing Irish companies to convert into REITs. However, any latent capital gains attributable to its assets will be taxed on the date of conversion.


REITs should provide a welcome additional option for Irish domiciled property investment vehicles (investing both in Ireland and elsewhere). They should permit low cost entry for investors at a time when the Irish property market is proving attractive for foreign investors. In this regard, they should complement existing investment vehicles such as qualifying investor funds which are appropriate for larger, institutional investors and are subject to regulation by the Irish Central Bank.

Gerry Thornton (


Tel: + 353 1 232 2664

More from across our site

This week European Commission officials consider legal loopholes to secure minimum corporate taxation, while Cisco and Microsoft shareholders call for tax transparency.
The fast-food company’s tax settlement with French authorities strengthens the need for businesses to review their TP arrangements and documentation.
The full ALP model will be adopted through a new TP regime, which is set to boost the country’s investments and tax certainty.
Tax professionals have called on the UK government to reconsider its online sales tax as it would affect the economy at the worst time.
Tax professionals have called on companies to act urgently to meet e-invoicing compliance targets as the EU plans to ramp up digitisation.
In the wake of India’s ambitious 25-year plan for economic growth, ITR has partnered with leading tax commentators to discuss what the future will look like for India and for the rest of the world.
But experts cast doubt on HMRC's data and believe COVID-19 would have increased the revenue shortfall.
EY’s plan to separate its auditing and consulting businesses might lessen scrutiny from global regulators, but the brand identity could suffer, say sources.
Multinationals are asking world leaders to put a scale on carbon pricing to tackle climate change at the 48th G7 summit in Germany, from June 26 to 28.
The state secretary told the French press that the country continues to oppose pillar two’s global minimum tax rate following an Ecofin meeting last week.
We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree