The local property tax (LPT) is annual self-assessed tax charged on the market value of all residential properties in Ireland. It came into effect on 1 July 2013 and is collected by the Revenue Commissioners. The tax is assessed on residential properties. The owner of a property is liable (though in the case of leases over twenty years, the tenant becomes liable). The revenue raised is used to fund the provision of services by local authorities and includes transfers between local authorities. [1]
Valuation and rates
The tax is based upon the assessed market value of the property in May 2013. This valuation is to be used as the basis for a half-year payment in 2013, as well as 3 further full year payments in 2014, 2015 and 2016. The tax due is calculated via a system of market bands. The initial national central rate of the tax is 0.18% of a property's value up to €1 million, and in the case of properties valued over €1 million, 0.25% on the balance. From 1 January 2015, local authorities will be able to vary LPT rates -/+ 15% of the national central rate.
| Valuation band (€) | Midpoint of valuation band (€) |
LPT in 2014 (1 yr) (€) |
|---|---|---|
| 0 to 100,000 | 50,000 | 90 |
| 100,001 to 150,000 | 125,000 | 225 |
| 150,001 to 200,000 | 175,000 | 315 |
| 200,001 to 250,000 | 225,000 | 405 |
| 250,001 to 300,000 | 275,000 | 495 |
| 300,001 to 350,000 | 325,000 | 585 |
| 350,001 to 400,000 | 375,000 | 675 |
| 400,001 to 450,000 | 425,000 | 765 |
| 450,001 to 500,000 | 475,000 | 855 |
| 500,001 to 550,000 | 525,000 | 945 |
| 550,001 to 600,000 | 575,000 | 1,035 |
| 600,001 to 650,000 | 625,000 | 1,125 |
| 650,001 to 700,000 | 675,000 | 1,215 |
| 700,001 to 750,000 | 725,000 | 1,305 |
| 750,001 to 800,000 | 775,000 | 1,395 |
| 800,001 to 850,000 | 825,000 | 1,485 |
| 850,001 to 900,000 | 875,000 | 1,575 |
| 900,001 to 950,000 | 925,000 | 1,665 |
| 950,001 to 1,000,000 | 975,000 | 1,755 |
In the case of properties valued over €1 million, no banding applies – 0.18% is charged on the first €1 million (€1,800) and 0.25% on the balance. The government estimates that 85% to 90% of all properties falls within the first five taxation bands. [2] [3]
Exemptions
If some conditions are met, certain properties are exempt from LPT. Each exemption has its own set of qualifications.
These types of properties may be exempt from Local Property Tax (LPT):
- Properties that have been certified as having significant pyrite damage
- Properties constructed with faulty concrete blocks
- Residential properties owned by a charitable organization or a public body
- Nursing homes that are licensed
- Commercial real estate
- Properties that have been vacated by their owners due to illness
- Property purchased, constructed, or adapted for a person who is permanently and completely disabled
- Properties used as residential accommodation by charitable organizations
In order to claim an exemption as part of your LPT Return, you must provide certain information, such as your name, PPSN, property ID, and property address. Additionally, some exemptions may require you to submit supporting documentation to Revenue.
To claim an exemption for the years 2023 to 2025, even if you missed claiming it for 2022, you can reach out to the LPT branch in Revenue. If you have already submitted an LPT Return without claiming an exemption, you should contact Revenue again. [4]
Payment
On 6 May 2013, the Revenue Commissioners reported that 1.2 m household lds (74%) have paid the property tax. [5] In August 2013, the Revenue said 1.58 m households have paid the tax, and over €175 m has been collected. [6] Anyone who still has not paid by August 2013, will have the tax deducted from their salary or pension. [6]
Previous property taxes
Household charge
The household charge was introduced by the Local Government (Household Charge) Act 2011, [7] for collection in 2012. It was a flat-rate charge of €100 on each principal private residence, and acted as a precursor for the local property tax.
Non-principal private residence charge
The non-principal private residence charge was introduced by the Local Government (Charges) Act 2009, [8] for collection from 2009 to 2012. It was a flat-rate charge of €200, that was payable respect of residential property that was not the owner's only or main residence.
Residential property tax
The residential property tax was introduced in the Finance Act 1983 [9] and was abolished on 5 April 1997.
It was an annual tax, charged at the rate of 1.5% per annum on the portion of the market value of an owner-occupied house which was greater than (in 1996) £101,000, as long as the household income exceeded £30,100.
Exemption from the RPT was possible [10] if certain buildings [11] were open to the public. This means that the exemption from RPT was possible in the case of property such as Charles Haughey's Kinsealy mansion—partially open for the Irish Cancer Society's Daffodil Day.
Rates
Prior to 1977, all property owners in Ireland had to pay " rates" – based on the "rateable valuation" of the property – to the local council. Rates were used by local authorities to provide services such as mains water and refuse collection. Rates for private residences were abolished in 1977, with local authorities instead receiving funding from central government. They continue in operation for commercial property.
Refuse collection services are no longer operated or funded by local authorities in Ireland.
See also
References
- ^ "How Local Property Tax Changes Will Affect the Housing Market?".
- ^ "Local Property Tax (LPT)" (PDF). www.revenue.ie. Archived from the original on 21 December 2012.
- ^ "Budget 2022" (PDF). www.gov.ie.
- ^ Valcheva, Kristina (3 February 2023). "Property Tax in Ireland: The Ultimate Guide for Landlords". www.ptireturns.com.
- ^ "Household tax dodgers pay up as Revenue closes in". Irish Independent. 6 May 2013.
- ^ a b "Revenue says property tax from non-payers to be taken at source next week". RTÉ News. 2 August 2013.
- ^ Book (eISB), electronic Irish Statute. "electronic Irish Statute Book (eISB)". www.irishstatutebook.ie.
- ^ Book (eISB), electronic Irish Statute. "electronic Irish Statute Book (eISB)". www.irishstatutebook.ie.
- ^ "Revenue Commissioners – Residential Property Tax". Archived from the original on 15 December 2012.
- ^ Book (eISB), electronic Irish Statute. "electronic Irish Statute Book (eISB)". www.irishstatutebook.ie.
- ^ Book (eISB), electronic Irish Statute. "electronic Irish Statute Book (eISB)". www.irishstatutebook.ie.