Capital gains for companies

A company can make a capital gain from selling or transferring an asset. This gain should be included in the profits for Corporation Tax (CT) purposes on a CT1 Form. The tax is assessed in the same accounting period that the gain is made. 

Capital gains on development land

Capital gains from selling or transferring development land are not included in a company’s profits. Instead, the company must pay Capital Gains Tax (CGT) on these gains. A non-resident company must also pay CGT on a gain it makes from the sale of non-trading assets that are located in Ireland. 

A company can offset a loss it makes on development land against gains from the sale of other assets. It can also use any loss it makes on the sale or transfer of non-development land to reduce gains on other non-development land assets. This can only be done in the accounting period that the loss is made. It can carry forward the unused losses to the next accounting period. 

What rate of tax is used?

The rates of CT and CGT are different. If CT is chargeable on a capital gain made by a company, the company must adjust the gain so that the correct amount of tax is paid.