Do you dream of moving to Ireland It is easy to see why so many tourists choose Ireland for its beautiful scenery, bustling cities, and affordable property.
It can be difficult to buy property in Ireland as an international buyer. This guide will help you understand everything. We will show you how to get a mortgage, what the property prices are in Ireland and where to find them. So, let’s get started.
10 facts if your non-resident intention is to buy property here in Ireland
- No restrictions apply to foreign nationals purchasing property in Ireland. This means that foreign nationals from the EU/ EEA as well as non-EU/ non EEA countries can buy property in Ireland without restriction.
- A resident in Ireland cannot be granted a right to reside there if they own a residence. Each individual’s circumstances will determine whether they are eligible to live in Ireland and whether or not. See the Irish National and Immigration Service website for further details.
- Similarly, the ownership of commercial property here does in general not allow a non-EEA citizen to operate a business using that property. However, permission must be granted by the Minister for Justice Equality and Law Reform. EU/EEA citizens can operate a business in Ireland, and they are not restricted by the general principles EU law. If a company has at least one director who is resident in Ireland, the property can be used to run a business. Each individual’s situation will dictate how the right to residence of each director and employee is treated.
- It is important that you note that a tenant of an Irish non-resident Landlord is obliged by current tax legislation to withhold 20% of the annual rental and pay it to the Revenue, unless the landlord has appointed a “Collection Agent” to assess for tax on that particular rental property. A collection agent is typically an estate agent or solicitor, but it could be any other person living in Ireland. Tenants will be able to pay full rent to the Irish resident agent after a collection agent has been elected. The process of appointing a collection agency is simple. Complete an Income Tax Registration for Collection Agents form and send it to Revenue. First, the Landlord needs to register his/her PPS or tax number for income tax. The Collection Agent then needs to apply for a separate Personal Public Service Number or tax number from the Department of Social Protection. This will link to the Irish landlord’s tax number. Revenue has acknowledged a Collection agent and tenants can pay their rent to the Collection agent without deducting tax once they have done so.
- A purchaser must pay stamp duties at 6% of the commercial property transaction’s market value. Stamp duty is charged on residential property transactions at 1% on the market value of up to EUR1m, and at 2.2% on any amount above that. The purchaser must pay stamp duty within 30 days from the completion of each transaction in both cases. To file a stamp duty report, a PPS (or tax Number) will be required. It can take some time (currently 8 weeks) for the Department of Social Protection to issue one to a purchaser. This could potentially delay the completion of the transaction. A PPS or Tax Number is not required for individuals or businesses that have never resided or conducted business in Ireland. These delays could result in the loss of a transaction.
- In Ireland, the conveyancing process can be broken down into three stages. The negotiation stage is where solicitors are usually not involved, while pre-contract stage is where solo practitioners are involved and then completion. Solicitors are involved. Negotiation involves the negotiation stage, which usually involves private individuals or their estate agents/representatives negotiating the sales price as well as “heads of terms”. Most of the legal work is completed by solicitors in Ireland at the “precontract stage”. Once a contract is signed by both sides, it can usually be completed within a short time. Each transaction is different and will determine the time required to complete a purchase. This includes whether the buyer is buying cash only or with both cash as well as the benefit from a mortgage. The conveyancing transaction should be completed in 4 weeks if everything goes according to plan.
- An annual fee (known as “local tax”) of up 0.18% of the market value for a residential property in Ireland above EUR1m and 0.23% on any balance of the MI over EUR1m must all be paid to the Revenue by the 10th of January each year. This is something that prospective investors will need to remember before they purchase a property on a “buy to let” basis.
- Commercial property is subjected to rates. These rates are paid to the local authority. The size of the property will affect the amount payable.
- A management company may have to pay service fees if the property, commercial or residential, is located in a serviced community.
- Ireland has signed comprehensive double-taxation agreements with 73 other countries. These agreements generally result in non-resident landlords paying no more tax that they would in their country of residence.