Taxes Consolidation Act 1997 section 649B

Windfall gains from rezonings: rate of charge

Section 649B imposes a special 80% rate of capital gains tax on "windfall" gains attributable to a relevant planning decision, applying to disposals of development land made between 30 October 2009 and 31 December 2014.

• A "windfall gain" is the increase in market value of land resulting from a relevant planning decision, being either a rezoning from non-development to development use or a decision to allow a material contravention of a development plan.
• The 80% rate applies to the lesser of the total gain on disposal and the windfall gain, with anti-avoidance rules extending the charge to land acquired through transfers between connected persons.
• Exemptions apply to compulsory acquisitions, disposals by NAMA subsidiaries, and disposals of small sites (0.4047 hectares or less, worth no more than €250,000), all of which are taxed at the standard CGT rate.
• Only a loss attributable to a decrease in land value arising from a rezoning may be offset against a windfall gain; ordinary CGT losses cannot be set against gains charged at the 80% rate.