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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, with the owner a property being 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. Such services currently include public parks; libraries; open spaces and leisure amenities; planning and development; fire and emergency services; maintenance and cleaning of streets; and street lighting. Some recent media reports dispute that such services have been funded from 2013 property tax receipts.[citation needed]

Contents

Valuation and ratesEdit

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.[1][2]

ExemptionsEdit

Properties which suffer from pyrite problems are exempt from the property tax initially.

PaymentEdit

On 6 May 2013, the Revenue Commissioners reported that 1.2 m household lds (74%) have paid the property tax.[3] In August 2013, the Revenue said 1.58 m households have paid the tax, and over €175 m has been collected.[4] Anyone who still has not paid by August 2013, will have the tax deducted from their salary or pension.[4]

Previous property taxesEdit

Household chargeEdit

The household charge was introduced by the Local Government (Household Charge) Act 2011,[5] 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 chargeEdit

The non-principal private residence charge was introduced by the Local Government (Charges) Act 2009,[6] 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 taxEdit

The residential property tax was introduced in the Finance Act 1983[7] 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[8] if certain buildings[9] 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.

RatesEdit

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.

See alsoEdit

ReferencesEdit

  1. ^ Revenue Commissioners (Ireland) – Local Property Tax (LPT), Frequently Asked Questions (5 December 2012) Archived 21 December 2012 at the Wayback Machine
  2. ^ Budget 2013 (Ireland) – ANNEX B – Local Property Tax (LPT) (5 December 2013)
  3. ^ "Household tax dodgers pay up as Revenue closes in". Irish Independent. 6 May 2013.
  4. ^ a b "Revenue says property tax from non-payers to be taken at source next week". RTÉ News. 2 August 2013.
  5. ^ Irish Statute Book – Local Government (Household Charge) Act 2011
  6. ^ Irish Statute Book – Local Government (Charges) Act 2009
  7. ^ Revenue Commissioners – Residential Property Tax Archived 15 December 2012 at the Wayback Machine
  8. ^ Book (eISB), electronic Irish Statute. "electronic Irish Statute Book (eISB)". www.irishstatutebook.ie.
  9. ^ Book (eISB), electronic Irish Statute. "electronic Irish Statute Book (eISB)". www.irishstatutebook.ie.

External linksEdit