Month: July 2020

 

This is a summary on Irish tax residency and taxation of Irish source income. An individual is regarded as Irish tax resident for a given tax year if he or she spends 183 days or more in Ireland during the tax year, or 280 days or more in Ireland in the current tax year and the previous tax year.

With regard to the taxation of non-residents, Ireland subjects non-resident individuals to Irish income tax on certain Irish source income only, however, there are a large number of exemptions available, depending on the type of income and whether the recipient of the income is resident in a country with which Ireland has a double tax treaty.

While every investment opportunity is different, and investors should always obtain independent tax advice, in our experience, investments which involve the provision of loan finance to property development groups do not generally result in a non-resident investor being subject to Irish tax on any interest income earned and the interest can generally be paid without deduction of Irish withholding tax where the investor is resident in a country with which Ireland has a double tax treaty. The interest income may be taxable in the recipients home country. There is a link on this website to Irish Revenue, where a full list of countries who have a double tax treaty with Ireland can be found.

 

The law in Ireland consists of Irish constitutional law, Statute and Common Law.

The Irish Constitution

The Irish Constitution was enacted in 1937 and is the cornerstone of the Irish legal system. It is the source of power exercised by the Irish government. The Irish courts may strike down laws if they are inconsistent with the Irish Constitution.

The Irish Constitution can only be amended by referendum. There have been 37 referendums: 27 of which were approved by the Irish people and 10 of which were rejected.

Under the Irish Constitution, many rights are guaranteed to citizens, and these include:

• Freedom of expression
• Right to equality before the law
• Freedom to travel
• Freedom of conscience and religion
• Right to education
• And right to personal privacy

Statute

In terms of Statute, Article 50 of the Irish Constitution carried over all laws that had been in force in the Irish Free State prior to its coming into force in 1937, therefore the Irish statute book stretches back in excess of 800 years and includes many British Statutes. Modern-day Statute law is made by the Oireachtas (a part of the Irish national parliament) and all Statute law must comply with the Irish Constitution.

Common Law

Ireland is a common law country, similar to countries such as the United Kingdom, the United States and Australia. As with any common-law system, the Irish courts are bound to apply clear precedents set by higher courts except that the Irish Supreme Court is not bound by its own previous decisions.

EU

Ireland has been a member state of the European Union since 1973, therefore Ireland (along with other member states) cannot pass national laws that contradict EU laws and an EU law can have direct application in Ireland. Ireland is now the only native English speaking country in the EU.

 

So…. A few points on real estate and doing business in Ireland –

• Ireland is a member of the European Union and the only country in the EU whose first language is English. It has a sophisticated, well educated workforce and State structures which are transparent and fair.
• Ireland is a common law country – like countries such as England, the United States and Australia. Irish property law is essentially based on Irish legislation and common law.
• There are no legal restrictions on the ownership of real estate in Ireland so property can belong to resident or non-resident parties.
• There are also no restrictions on the transfer of ownership of property from one person to another.
• Irish property can be held under freehold title which confers absolute ownership and has the potential to last forever or leasehold title which confers ownership for a period of years granted by a lease.
• The Irish State’s Property Registration Authority controls the systems for recording real estate transactions in Ireland. These systems can be accessed online.
• In order to purchase a property in Ireland, you must engage a solicitor who is qualified with the Law Society of Ireland.
• Typically we would allow approximately 4-8 weeks to complete an acquisition of a property in Ireland.
• In summary, Ireland has a sophisticated, well educated workforce. There are fair and transparent systems in place which make it a great place to buy real estate and to do business.

The Immigrant Investor Programme or IIP offers secure residency status in Ireland, through an approved investment. The IIP is open to non-European nationals who may apply for themselves, their spouse or civil partner, any children under the age of 18 and any dependent children between the ages of 18 and 24 (provided they are not married and in full time education).

There are four simple steps to the IIP process;

• Number One. Application, make an application to the Irish government.
• Number Two. Approval, have that application approved.
• Number Three. Investment
• Number Four. Receive residency

A key feature of the Irish programme is that the investment is only required to be made after your application has been approved. The process is very straight forward and the approval time currently takes between 4 and 6 months. The residency requirements, meaning the required time to spend in Ireland to maintain this immigration status, is only one day per calendar year.

There are 4 investment options to choose from;

• Enterprise Investment: which requires a €1 million investment to a qualifying Irish enterprise for a minimum of 3 years.
• An Investment Fund: Which requires €1 million to be invested in an approved fund for a minimum of 3 years.
• A Real Estate Investment Trusts or REIT: Which requires a €2 million investment for a period of at least 3 years.
• And the Endowment option: Which requires a philanthropic donation of €500,000.

Bartra operate under the enterprise investment, where we provide secure investments to our qualifying Social Housing and Nursing Homes projects. Both of these assets provide very safe investments, as they both derive income from the Irish State. It is also worth noting that to date, Bartra maintains a 100% approval rate within IIP.

The healthcare system in Ireland is internationally recognised as a comprehensive system, firstly with a public health service funded by the government and secondly with an expanding private health care service. There are forty eight public hospitals and twenty one private hospitals in total. The Irish system has been recognised globally for its successful management of the coronavirus pandemic. Irish case numbers per thousand are significantly below those of other major European countries, including our neighbours the United Kingdom.

Ireland is one of the leading destination for pharmaceutical activity in the world our public and private hospitals have consistently built an unparalleled reputation in new high-tech surgical procedures, medical treatments, and ground-breaking diagnostics. Overall patient outcomes in Ireland are very positive. This reputation means that some of the best international and national consultants work in Irish Healthcare. A large number of hospitals have been recognised by the Joint Commission International (JCI) which accredits hospitals that have raised safety and quality of care standards to the highest levels.

Hong Kong and China are important sources of Foreign Direct Investment for Ireland. Highly respected businesses such as Bartra have been instrumental in building this relationship over many years.  While Hong Kong and Chinese investment into the US and mainland Europe reached a nine year low in 2019, investment in Ireland in the twelve months grew by 56% per cent to $150 million. This interest in Ireland is a direct result of a long period of Government and business relationship building between the countries.

Indeed, Richard Barrett, the Founder of Bartra, has spent the past 3 decades engaging in premium, high specification, large scale projects in Ireland, Hong Kong and China. In doing so he has been the initiator of a vast network of investment opportunity that has brought Irish Investors to Asia, and similarly brought Asian investors to Ireland.  This mutually beneficial network has laid the foundations for much of Bartra’s current portfolio across the social housing, healthcare and renewable energy sectors.

Bartra partners with the Irish Government Investor Incentive Programme to facilitate, in a structured and secure way, investment in social housing and healthcare projects in Ireland. The IIP also provides the opportunity for investors, and their families, to reside in a country that has one of the highest quality of life standards in the world. Come join us, you will be most welcome!