Buying or transferring property
Certain property deriving its value from immovable property
The Finance Act 2017 introduced new rules relating to Stamp Duty on certain property deriving its value from immovable property. These new rules are in Section 31C of the Stamp Duties Consolidation Act, 1999. The new rules apply to instruments (written documents) executed (signed, sealed or both) on or after 6 December 2017.
Under the new rules, you must pay Stamp Duty on certain written contracts or agreements to buy:
- shares, stocks or marketable securities (other than shares in certain investment companies) (“shares”)
- units in an Irish Real Estate Fund (IREF) (“units”)
- interests in partnerships (“interests”)
where certain conditions are met.
The conditions are:
- the shares, units or interests must derive their value or the greater part of their value from immovable property
- the immovable property must be non-residential property
- the purchase must result in a change in control
over the company, IREF or partnership and in the immovable property owned by that entity.
Control may be exercised directly or indirectly.
- the company, IREF or partnership must deal in land or develop land for non-residential purposes.
Where the written contract or agreement meets these conditions, you must pay Stamp Duty at the rate applicable to non-residential property.
If you do not have a written contract or agreement, you may still have to pay Stamp Duty. Where:
- the above conditions are met
- you have an instrument (“written document”) transferring ownership of the shares, units or interests to you
you must pay Stamp Duty on the instrument. You pay Stamp Duty at the rate applicable to non-residential property.
The Finance Act 2017 contained transitional arrangements. Under the transitional arrangements:
- where there is a binding contract to sell shares, units or interests in place before 6 December 2017
- the instrument transferring ownership is executed before 1 March 2018
- that instrument contains a certificate
the Stamp Duty position is the same as that which applied prior to the introduction of Section 31C.
The wording of the certificate is:
"It is hereby certified that this instrument was executed solely in pursuance of a binding contract entered into before 6 December 2017."