There are a number of changes to the controversial Local Property Tax Bill, including exemptions for certain homeowners.
Homes affected by pyrite and properties owned by charities and which are used for recreational purposes as part of their main activity will now be exempt from the property tax. Also, persons permanently incapacitated will also be exempt.
Property tax payment deferrals will be available to the personal representative of a deceased person’s estate. The deferral will be permitted for up to three years until the estate’s affairs have been put in order.
Deferrals will also be available for cases of excessive financial hardship and where personal insolvency arrangements are in place.
Ed Carey, chair of the Residential Agency Professional Group of the Society of Chartered Surveyors Ireland (SCS) said: “Bringing a sense of fairness and equity into the introduction of this tax was essential and some of the concessions announced will go some way to alleviating the financial pressures on those in dire financial circumstances.
“While the Finance Bill provides more detail on the implementation of the property tax, we look forward to the publication of a valuation self-assessment guide for homeowners so that they can begin to plan financially for the introduction of the tax this summer.”
The Finance Bill includes a number of provisions for the declaration of property valuations to the Revenue, explains Eugene O’Riordan, tax director at PwC in Cork.
“A person buying a house will be entitled to know the valuation the vendor declared to Revenue. If the price is higher than the valuation then the buyer can report the vendor to Revenue.”
The Finance Bill also includes a new measure to ensure that property developers pay stamp duty up front. Under previous legislation property developers widely availed of a loophole called ‘resting in contract.’ This enabled a developer to avoid or defer paying stamp duty for the lifetime of the development project. This loophole has been scrapped.
Properties owned by local authorities will be valued in the lowest valuation band between this year and 2016 and will only be subject to a common methodology after that.
The Finance Bill also puts into legislation Real Estate Investment Trusts, which were announced in the budget and are an attempt to attract international investors into the domestic property market.
Irish Tax Institute president Martin Phelan said it is a welcome move. “It is a real effort to create overseas investor interest in the Irish market at a time when we are trying to kick start property transactions again.”
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