Stamp duty changes – the expected and unexpected (Budget 2020)

Oct 08, 2019

The Minister, as expected, increased the rate of stamp duty on commercial property acquisitions to 7.5 percent. With effect from Budget night, stamp duty at the rate of 1 percent is also being introduced for certain schemes used for the sale of a company.  

Commercial property increase

The increase in the rate of stamp duty for commercial property is expected to bring in €141 million in 2020. The Minister’s rationale for the increase is that the Irish commercial property market continues to perform strongly; he expects the sector to be able to bear this increase “without any significant impact”. The Minister also commented that there are long-standing relief measures aimed at mitigating the increase in certain circumstances.


This increase will be subject to transitional arrangements that will allow the 6 percent rate to apply to instruments executed before 1 January 2020, where a binding contract existed prior to 8 October 2019.


Consequential amendments will also be made to the legislation which will provide for the repayment of stamp duty where the land involved is subsequently used for residential development. This is to ensure that the rate of stamp duty chargeable after a full refund remains at 2 percent.


Anti-avoidance – company acquisitions


The new 1 percent stamp duty charge is an anti-avoidance measure that will be applicable where a scheme of arrangement involving a so called ‘cancellation scheme’, in accordance with Part 9 of the Companies Act 2014, is used for the sale of a company. The expected Exchequer take from this measure does not appear in the Budget 2020 documents.


Full details on both these stamp duty measures are contained in the Budget 2020 Financial Resolutions.