The high stamp duty rates that currently apply to property transactions in this jurisdiction mean that more people are considering buying investment property in a company vehicle.

Commercial property transactions with a value in excess of €150,000 attract stamp duty on the consideration at the crippling rate of 9 per cent.

In stark contrast, the purchase of shares in a company incurs stamp duty at 1 per cent of the value and, therefore, many purchasers see purchasing property through a company as a more cost-effective option.

In fact, so popular had this route become that it was widely rumoured that the last Budget was going to tackle this issue by raising the stamp duty rate where the only asset of the company was property.

A further attraction is the fact that if the property is leasehold, as is common in commercial and investment properties, the purchase of the shares in the company that holds the lease can be a useful means in sidestepping the often thorny issue of landlord's consent to the transfer of the lease to a third party.

Obtaining the consent of a landlord to an assignment of a lease can be a major headache for a purchaser, both in terms of the length of time it takes and the requirements involved, often including unpalatable requirements for personal guarantees and detailed financial information.

Many alienation clauses in leases do not address the issue of a change in control of the company that owns the property and so, in many cases, landlord's consent may not be necessary if the shares in the owner company are purchased.

Purchasers should, however, be aware of a possible double charge to capital gains tax (CGT) on disposal in transactions where the property has been purchased through a company.

If the property is sold by either an individual or a company, the proceeds will generally be subject to CGT at 20 per cent. (Principal private residences are exempt from CGT.)

However, while an individual pays the CGT and retains the balance of the proceeds, the shareholders in a company will attract a further tax liability if they wish to personally access the proceeds from a sale.

The common method of releasing the equity is by way of liquidating the company, giving rise to a further CGT liability on the liquidation.

This double charge to CGT is an onerous tax liability and needs to be examined carefully by a person intending to purchase property through a company.

While it occurs on the disposal of a property rather than the acquisition, when stamp duty is payable, it may negate any savings on stamp duty made at the acquisition stage.

It is important to note that purchasers of shares in a company that owns property inherit the tax history of the company, including its CGT history.

A purchaser might pay €2 million for shares in a company with a property asset worth €2 million but the historic base cost of the property for CGT purposes might only be €1 million leaving an inherent CGT liability of €200,000 in the company.

Another potential disadvantage of purchasing property through a company is the fact that the purchaser of the shares in the company takes over all of the company's problems and liabilities, rather than just those of the property.

The due diligence exercise may be a lengthier and more expensive process. In addition, the costs of complying with requirements of the Companies Acts regarding the filing of annual returns adds further expense.

While such a decision will often be guided by practical concerns, it is important that purchasers intending to buy through a company vehicle be aware that a considerable saving in stamp duty at the purchase stage may mean higher CGT liability on the disposal of the property.

Effective legal and tax planning at the outset is essential.

Vanessa Byrne is a senior associate in the property and construction department of Mason Hayes & Curran Solicitors.