Catherine Murphy (Kildare North, Social Democrats)
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238. To ask the Minister for Finance the regulatory differences between REITs, QIFs and QIAIFs; the number of QIAIFs in operation here; the date of commencement of each; the country of origin of each; the value of commercial and residential property held by each QIAIF; the estimated annual rental income collected; the net value of tax collected annually net of withholding tax refunds since their introduction; and if he will make a statement on the matter. [34613/17]

Catherine Murphy (Kildare North, Social Democrats)
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239. To ask the Minister for Finance his views on the impact of the Finance Act 2016 on the operation of QIAIFs, including but not limited to the impact on taxes paid; if the changes were retrospective; if they apply to QIAIFs in existence prior to the operation of the Finance Act 2016; and if he will make a statement on the matter. [34638/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 238 and 239 together.

Qualifying Investor Funds (“QIF’s”) and Qualifying Investor Alternative Investment Funds (“QIAIF’s”) are forms of investment undertakings and are regulated by the Central Bank.  QIAIFs were introduced in July 2013 to meet the requirements of the Alternative Investment Fund Managers Directive. It is a non UCITS fund. These vehicles are targeted at sophisticated private investors and institutional investors.  All investors in a QIAIF must make an initial subscription of €100,000. QIAIFs are generally used for riskier alternative investment strategies such as hedge funds, real estate funds and venture capital/equity funds. The normal investment and borrowing restrictions generally imposed by the Central Bank on Irish funds aimed at smaller scale investors are relaxed for QIAIFs, recognising the ability of their investor group to bear a higher level of risk. 

A REIT is a collective investment vehicle specifically designed to hold property. It is a quoted company and must be listed on the main stock exchange of an EEA country.  In line with their company status they are subject to the provisions of the Companies Acts. The requirement that they are listed on the main stock exchange of an EEA country, also means that they are also subject to the rules of the relevant stock exchange. 

Finance Act 2016 provided for the introduction of a tax regime for Irish Real Estate Funds (‘IREFs’).  The section was introduced to address the use of certain collective investment vehicles to invest in Irish property by non-resident investors.  The IREF regime provides for taxation of investment undertakings, where 25% of the value of that undertaking is made up of Irish real estate assets

As a result of these changes a QIAIF that has more than 25% of its value derived from Irish Real Estate assets will become an Irish Real estate Fund. This legislation is applied to profits from January 1 2017 and applies to all QIAIF’s that meet this threshold regardless of their date of origination.

I am advised by Revenue that data regarding the full impact of the Finance Act 2016 amendments will not be available until the first returns for IREFs are examined; these are due by 30 January 2018 for an accounting period ending on or before 30 June 2017 and by 30 June 2018 in connection with an accounting period ending between 1 July and 31 December 2017.