Taxes Consolidation Act 1997 section 644AB

Treatment of profits or gains from land rezonings

Section 644AB imposes a special 80 per cent income tax rate on "windfall" profits or gains arising from land disposals that are attributable to relevant planning decisions, for the years of assessment 2010 to 2014.

• Profits or gains from land dealing or development (Case I) or capital-nature gains from land disposals (Case IV under section 643), to the extent attributable to a rezoning or material contravention decision, are taxed at 80 per cent as income tax rather than corporation tax.
• Rezoning profits are ring-fenced: they are disregarded for all tax purposes except assessment, collection and recovery of the 80 per cent charge, and losses attributable to rezoning may only be set against future rezoning profits.
• In computing the profits subject to the 80 per cent rate, profits attributable to construction operations on the land or to qualifying land (compulsory acquisitions, NAMA disposals, and small sites of 0.4047 hectares or less valued at not more than €250,000) are excluded.
• Rezoning profits are not reckonable income for PRSI or health levy purposes, and distributions from such profits are similarly excluded from the recipient's income for tax, PRSI and health levy purposes.