These types of properties are Tax Based Property Investment which were common through the 1990’s and early 2000’s. The main purpose was to renew old urban and town  centres and different types of property by incentivising private investors to invest in these properties. The most common types were Section 23 and Section 50.

Section 50 property is student accommodation built close to and for letting to students of a particular college. They are specially designed for single or double room letting.

Section 23 properties are ordinary housing units built in certain areas and towns in the country which are perceived to be in need of some additional benefits in order to promote a letting market.

The tax break is given as a further deduction against the net rental income not just from that specific property but from the total of all net rental profits in that year.

Only Irish rents can be sheltered. If the purchaser has sufficient Irish rental income, the whole of the tax break can be used up in one year. Otherwise, the Section 50 or Section 23 deductions create a rental loss that can be carried forward against future Irish rental income.

The tax relief is clawed back if the property is sold or ceases to be a let premises within a period of ten years from first use.