Have you ever thought of moving to Ireland. It’s easy understand why so many foreigners choose Ireland with its beautiful scenery and vibrant cities.
What is the process of buying property in Ireland from a foreigner, exactly? We’ll guide you through the process. This includes the cost of property in Ireland as well as information on how to get mortgages and other useful information. So, let’s get started.
10 facts about non-residents who wish to buy property on Ireland
- The purchase of property in Ireland by foreign nationals is permitted without restrictions. This means that non EU/ EEA/ EEA nationals as well can purchase property here.
- However, owning a residential property here does not give you the right to reside in Ireland. Both residence and/or the right of remaining in Ireland are considered separate from property ownership. They depend on each individual’s personal circumstances. Please refer to the Irish National and Immigration Service.
- Similarly, a non EEA nation who is not a resident of the EU cannot operate a business in Ireland if they own commercial property. This permission must be given by the Minister to Justice Equality and Law Reform. EU/EEA residents can still operate a company and live in Ireland under the general principles EU law. A company may be allowed to operate a small business from its property if it has one director resident in Ireland. However, the circumstances of each individual will affect how they are allowed to choose their residence.
- It is important for tenants of non-resident Landlords in Ireland to note that they are required under current tax legislation (section1041 TaxesConsolidation Act 1997) to withhold 20% annually rent and pay same to Revenue unless the non resident landlord has appointed the ‘Collection Agent’ to assess tax on rents from this particular rental property. A collection agent can be an accountant, solicitor, estate agent, or solicitor. However it could also include any Irish resident. After a collection representative has been appointed, tenants will be able pay the full amount to the Irish resident agency. You can easily appoint a collection representative by filling out an Income tax Registration Form for Collector Agents and submitting it at Revenue. First, the Landlord should register his/her tax number (or PPS) for income tax. The Collection Agent must then apply to Department of Social Protection in order to receive a separate Personal Public Service or Tax Number.
- A purchaser must also pay stamp duty equal to 6% of the value of commercial property transactions. Stamp duty on residential property transactions are payable at 1% up to EUR1m or 2% on all amounts above this amount. Both stamp duty must be paid by the purchaser within 30 working days of the transaction’s completion. A PPS or tax number is required to file a return for stamp duty. This may take up to eight weeks (currently, approximately) from the Department of Social Protection. This could cause delays in the transaction. People or companies who have not lived in Ireland or had a business there may not be able to obtain a Tax Number or a PPS.
- The conveyancing process for Ireland can be divided into 3 stages: the negotiation stage (where solicitors generally are not involved), the pre-contract phase (solicitors involved), and finally, completion (Solicitors involved). Negotiation typically involves private individuals as well estate agents and representatives. They negotiate the sale price and terms. Because the majority of legal work is done at the “precontract” stage in Ireland, both the parties can sign the contract soon after it has been signed. It depends on the transaction, and whether the purchaser is buying cash alone or with the benefit a mortgage. The time taken to complete a sale will also depend on the type of transaction. It should be possible to close the conveyancing transaction in less than 4 weeks after contracts are exchanged.
- An annual charge, known as “local property taxes”, of up to 0.18% of the market price of a residential home in Ireland with a maximum value of EUR1m and up to 0.233% on the balance must be paid annually to the Revenue before the 10th January of each year. This is something a potential investor should remember prior to purchasing a property for ‘buy-to-let’.
- Rates are due to the local authority for the location of commercial property. The property’s dimensions and other factors will influence the amount of the tax due.
- Management companies may be subject to service charges if residential or commercial property is found within a serviced land.
- Ireland has signed comprehensive double taxes agreements with 73 nations. They generally mean that non-resident landlords are no more taxed than they would be in their country.