Capital Gains Tax on Investment Property Ireland: Rates, Exemptions, and Filing Deadlines
Capital Gains Tax on Investment Property Ireland: Rates, Exemptions, and Filing Deadlines
You've held an Irish investment property for eight years. It's appreciated significantly, the yield has compressed under RPZ caps, and you are considering selling. Before you sign anything, CGT needs to be modelled into the exit — because 33% on the nominal gain is not a small number, and the payment deadline arrives before you file your return.
Here is how Capital Gains Tax works for Irish property investors in 2026.
The Rate and the Basic Calculation
The standard rate of CGT in Ireland is 33%, applied to the net chargeable gain. There is no reduced rate for long-term holdings; the 33% applies whether you sell after two years or after twenty.
The chargeable gain is calculated as:
Gross disposal proceeds (sale price)
minus disposal costs (estate agent commission, solicitor fees on sale)
= Net disposal proceeds
minus acquisition cost (original purchase price)
minus acquisition costs (stamp duty paid on purchase, legal fees on purchase)
minus enhancement expenditure (capital improvements that permanently increased the property's value)
= Gross chargeable gain
minus annual personal exemption (€1,270)
= Net taxable gain
× 33%
= CGT liability
What Counts as Enhancement Expenditure
Enhancement expenditure is capital spending that permanently increases the property's value and is still reflected in the property at the time of sale. A structural extension, a new roof, or an energy upgrade that increases the BER rating may qualify. Routine repairs and maintenance do not — those are operating expenses deductible against your rental income annually.
Items that do not qualify as enhancement expenditure:
- Annual maintenance and minor repairs
- Decoration, carpeting, and cosmetic work
- Furnishing costs (these are claimed as wear-and-tear capital allowances instead)
- Any expenditure that has already been allowed as a rental income deduction
Keep receipts for all capital work on investment properties. Even if work was done a decade ago, having documentation of a €25,000 extension enables you to reduce the taxable gain by that amount at exit.
The Annual Personal CGT Exemption
Every individual is entitled to an annual exemption of €1,270, which shelters the first tranche of any gain from CGT. This exemption cannot be carried forward to future years and cannot be transferred between spouses.
However, if a property is owned jointly by two people (whether married, civil partners, or co-investors), each owner can apply their own €1,270 exemption against their respective share of the gain. On a property owned 50/50, the combined exemption is €2,540.
The €1,270 exemption is genuinely modest against the scale of gains typical in Irish property. On a property that has appreciated €150,000 since purchase, the exemption shelters less than 1% of the gain. It is worth claiming but not strategically significant.
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Worked Example: An Eight-Year Investment Property Sale
To illustrate how the numbers run:
| CGT Calculation Step | Amount |
|---|---|
| Sale price in 2026 | €450,000 |
| Less: Agent commission and solicitor fees on sale | -€7,500 |
| Net disposal proceeds | €442,500 |
| Less: Original purchase price (2018) | -€300,000 |
| Less: Stamp duty and legal fees at acquisition | -€5,000 |
| Less: Structural extension built in 2020 | -€25,000 |
| Total base cost | -€330,000 |
| Gross chargeable gain | €112,500 |
| Less: Annual personal exemption | -€1,270 |
| Net taxable gain | €111,230 |
| CGT liability @ 33% | €36,705 |
The investor retains €442,500 minus €36,705 = approximately €405,795 from the sale (before factoring in the remaining mortgage balance, if any). The base cost optimisation — primarily the €25,000 enhancement expenditure — saved approximately €8,250 in CGT. Good record-keeping pays dividends at exit.
Principal Private Residence Relief: The Former Home Exception
If you ever lived in the investment property as your principal private residence (PPR), you may qualify for partial CGT relief.
The gain is apportioned based on the proportion of the ownership period during which the property was your PPR. The last 12 months of ownership are always treated as a period of PPR occupation if the property qualified as your PPR at any earlier point — this is a statutory concession designed to give owners time to sell a property they have vacated.
Worked example: You owned a property for 10 years. You lived in it for the first 3 years, then rented it out for 7 years. The last 12 months of the 10-year period are treated as PPR (statutory relief). So the PPR period is 3 years lived-in plus 1 year statutory = 4 years. The relief is 4/10 of the total gain. The chargeable portion is 6/10 of the gain.
This relief is highly relevant for accidental landlords — people who moved out of a property due to work relocation, life change, or upsizing, and subsequently rented it rather than selling. Understanding the PPR relief calculation before selling can significantly reduce the CGT bill.
Indexation Relief: No Longer Available for Modern Properties
Indexation relief allowed investors to increase their base cost by an inflation multiplier, preventing tax on purely inflationary gains rather than real gains. It was abolished for assets acquired after December 31, 2002.
For virtually all investment properties purchased in the current market, indexation relief does not apply. The full nominal gain is taxable at 33% without adjustment for inflation. On a property bought in 2015 for €250,000 and sold in 2026 for €400,000, the €150,000 gain is fully taxable even though a portion of it reflects inflation rather than real value creation.
Capital Losses and Offsetting
If you have made losses on other investment asset disposals (shares, other properties), those capital losses can be offset against gains arising in the same tax year or carried forward to offset future gains. Capital losses cannot be carried back to prior years.
There is an important restriction: capital losses on development land cannot be offset against gains from non-development land. This is a niche point for most private investors but relevant if you hold both residential rental properties and land with development potential.
The Filing and Payment Deadlines: The Trap That Catches Investors
CGT operates on a different payment schedule to income tax, and the payment deadline precedes the filing deadline by months. This is the mechanism that consistently catches first-time sellers.
Payment deadlines:
- For disposals between January 1 and November 30: payment by December 15 of the same year
- For disposals in December only: payment by January 31 of the following year
Filing deadline:
- The formal CG1 return (which reports the disposal and calculates the gain) must be filed by October 31 of the year after the disposal
So if you sell a property in September 2026, you must pay the CGT by December 15, 2026. The formal return documenting the transaction is not due until October 31, 2027. The tax payment arrives a full ten months before the return.
Late payment of CGT incurs interest charges. If you receive proceeds in September and have not provisioned for the December payment, you have 15 weeks to arrange the funds. On a €36,000 CGT bill, that is not a small oversight.
Buying a Second Investment Property: No PPR on That Disposal
There is no CGT exemption for investment properties held entirely as rentals from the date of acquisition. PPR relief only applies if the property was genuinely your home at some point during the ownership period.
Some investors have explored moving into an investment property briefly before selling to trigger PPR relief. Revenue scrutinises this closely. The occupation must have been genuine and based on normal domestic use — Revenue can challenge claims where the occupation period was contrived specifically for CGT purposes.
Joint Ownership and Family Transfers
Transfers of property between spouses or civil partners at the time of permanent separation or divorce can be structured with CGT relief, but only under specific conditions. Gifts of property to other family members generally trigger a disposal at market value for CGT purposes, even where no cash changes hands.
If your investment property forms part of estate planning or a transfer to children, the CGT and CAT (Capital Acquisitions Tax) interaction requires specific planning. The two taxes can apply simultaneously to the same transaction, and the combined liability can be significant.
For a full financial model of how CGT at exit interacts with the 52.35% marginal rate on rental income, the timing of a market reset under the new TMD rules, and long-term net yield projections — the Ireland Investment Property Guide works through the complete investment lifecycle, from acquisition costs through to net disposal proceeds.
Summary: What Irish Property Investors Need to Know About CGT
- The rate is a flat 33% on the net chargeable gain — no long-term holding discount
- Every capital improvement that is not claimed as a rental deduction should be documented for use as base cost enhancement at exit
- PPR relief is significant if you ever occupied the property — calculate it before selling
- The December 15 payment deadline applies to most disposals; do not confuse it with the October 31 filing deadline
- The €1,270 annual exemption is worth claiming but strategically marginal
- Capital losses from other disposals can offset gains — review your full investment portfolio before triggering a CGT event
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