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Local Property Tax
The Local Property Tax (“LPT”) was introduced in Budget 2013.
This tax replaces the Household Charge for 2013 and applies to all residential properties, including dwelling houses, rental properties and second houses/holiday homes. Companies who own residential properties are also liable.
While the Revenue will estimate the tax due, the LPT will operate through a system of self assessment. A liable person is responsible for self assessing the value of their property and submitting a completed LPT return.
Calculating the Tax
The LPT will be based on the market value of a residential property on the valuation date of 1 May 2013. This valuation will be the basis of the calculation of the tax for a four year period until 2016. The tax payable in 2013 will be confined to a half year charge. From 2014, LPT will apply on a full-year basis. There are several full exemptions/ temporary exemptions from the tax.
The rates of the tax are as follows:
|Valuation||National Rate||Valuation Basis|
|Up to €1 million||0.18%||Mid-point valuation bands|
|Excess > €1 million||0.25%||Market Value|
Filing the LPT Return
Revenue will issue each liable person with a LPT return together with a detailed guide. This paper form can be completed and returned to Revenue. It will also be possible to submit the return on–line using the Property ID and PIN provided on the Return. If you own more than one residential property or if you are already obliged by law to make your tax returns on-line, you must submit the Return on-line. You will note below that there is an extended deadline for filing on line.
Methods of Payment of LPT
There are a number of ways that the tax can be paid. These are as follows:
- Debit/Credit Card (available online only)
- Bank Single Debit Authority. To select this option it will be necessary to complete the payslip on the RPT return and payment will be deducted from your bank account.
- Cash payments through certain service providers (e.g. the post office)
- Voluntary deduction at source from salary/occupational pension and certain payments made by the department of Social Protection and the Department of Agriculture, Food and the Marine.
The key dates for the LPT are as follows:
|01 May 2013 07 May 2013 28 May 2013 01 July 2013 15 July 2013 21 July 2013||The property must be valued on this date Deadline to file a paper LPT return Deadline to file an LPT return electronically Payment by one single payment or phased payment commences Commencement of direct debit payments Single Debit Authority payment deducted|
Penalty for Late/Non Filing
If a liable person fails to deliver a return, Revenue can estimate the tax due and impose a maximum penalty of €3,000. Interest will also arise on a daily basis. In addition to this, self employed taxpayers will be deemed to have not filed a complete income tax/corporation tax return by the due date, resulting in a surcharge of up to 10% of their liability.
Possible Exemptions from LPT
Certain properties are exempt from LPT and they are as follows:
- Residential property that is used wholly as a dwelling and liable to commercial rates;
- Principal private residence unoccupied by reason of long term mental or physical infirmity;
- Newly constructed but unsold residential property;
- Residential property owned by a public body or an approved charitable body and used to provide accommodation to people with special needs;
- Houses in “ghost” estates or unfinished developments;
- Properties purchased by first time buyers between 1 January 2013 and 31 December 2013 will be exempt until 2016; and
- Newly constructed properties bought from builder/developer between 1 January 2013 and 31 October 2016
- Registered Nursing Homes
Owner occupiers unable to pay the LPT can defer payment of the tax until their financial position improves or the property is sold in the following specified circumstances:
- Where gross income does not exceed €15,000 (single) and €25,000 (joint), LPT may be deferred in full;
- Where gross income does not exceed €25,000 (single) and €35,000 (joint), half of the LPT may be deferred;
- Where gross income, less 80% of mortgage interest falls below €15,000/€25,000, a deferral option will be available until 2017 (when mortgage interest relief also ends).
- Interest will be applied on deferred amounts at a lower rate of 4% . The deferred amount, including interest, will remain a charge on the property.
How Buckley Kiely Can Help
While Buckley Kiely cannot assist in the valuation of your property, we can assist with the completion of your LPT form and the calculation or payment of the tax due.