Pearse Doherty (Donegal, Sinn Fein)
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164. To ask the Minister for Finance the tax treatment regarding the distribution of the value of the fund to non-resident investors in the event of an Irish real estate fund being liquidated with assets valued at greater than the market value of their cost. [30041/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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I am advised by Revenue that Irish Real Estate Funds (IREFs) must operate IREF withholding tax on the happening of certain taxable events.  This includes the cancellation, redemption or repurchase of units as a result of liquidation.

The amount on which the IREF withholding tax is operated is the portion of any amounts so distributed which relate to Irish property profits.  Any difference between the market value of the Irish property assets on liquidation and their cost would form part of an IREF’s Irish property profits.

IREF withholding tax applies on distributions to non-residents, subject to specific exemptions as set out in the legislation.

Therefore, following liquidation any Irish property profits of the IREF which are distributed to non-residents, who do not come within the terms of the exemptions, will be subject to IREF withholding tax.