ICAV structure rivals Section 110s in popularity, say Central Bank stats

ALMOST 300 Irish Collective Asset-Management Vehicles (ICAV) have come into operation here in less than 18 months.

The ICAV — a hyper tax-efficient structure designed to attract funds industry jobs to Ireland — rivals controversial Section 110 companies in popularity, figures show.

Central Bank figures show 271 ICAVs have been authorised here since March 2015, while Revenue figures show 404 companies notified the tax collectors of their intention to take section 110 status in the 2015 calendar year.

Concerns have been raised that ICAVs, which are fully exempt from tax on income and profits, are being used by foreign and domestic investors to avoid paying tax on rental income in this country.

Revenue is examining the affairs of 40 Section 110 companies, the Sunday Independent revealed last week, and is also monitoring ICAVs. A Revenue spokeswoman said the tax collectors can’t comment on individual cases, but makes so-called compliance interventions on foot of “various risk indicators”.

Finance Minister Michael Noonan has committed to make legislative changes to the ICAV regime if necessary.

“Should these investigations uncover tax avoidance schemes or abuse, which erodes the tax base and causes reputational issues for the State, then appropriate action will be taken and any necessary legislative changes that may be required will be put forward for my consideration,” he told the Dail.