Proving property tax exemptions

The Irish Revenue Commissioners, a government funded agency, is responsible for  a multitude of financially related activities; some of these include customs, excise, and overall taxation. In 2013, Revenue changed the way that Local Property Tax (LPT) was collected for all residential properties in Ireland. 

This tax is meant to hold the owners of residential or rental properties accountable for the payment of tax on all of their assets. Beyond just these two groups, people who have a lease of twenty years or greater, local authority/social housing organizations, or a person acting as a personal representative for a deceased owner are also responsible for paying the LPT. 

LPT can be charged on homes that are unoccupied or uninhabited, if it is a suitable place to be lived in. If it is not up to par with regular living standards, no LPTs will have to be paid on the property. There is a great deal of opinion that comes into play when deeming a property livable or not, which is why the  Irish Revenue Commissioners requires that some type of documentation is provided. If no information is provided, you may be required to pay LPT on this asset. 

LPT also has a multitude of exemptions that could be available to home buyers. In 2013, one of the largest exemptions was extended across the home property market. Initially, this tax break was supposed to available to first time buyers, but without home purchase numbers increasing in the way the government needed it extended to many more sections.

For example, this 6 year tax exemption from 2013-2019 was available to properties that were self built between 1 January and 1 May 2013, residential properties constructed in 2013 , certain unfinished estates, and new or previously unused properties purchased from a builder or developer between 1 January 2013 and 31 October 2019. All of these purchases must have been utilized as your main residential property. 

This exemption is known as section 8, and has been saving around 11,500 homeowners significant amounts of money over the past 6 years. With the end of this deal quickly approaching, Revenue has been making a clear effort to make sure they have not been scammed money over this time. 

This agency has recently been requesting verification of purchase date and that this property that they purchased was their sole residence after that; they are given 28 days after initial contact from Revenue to get the correct documentation and prove their eligibility. 

If you have illegally used the tax exemption of 2013, you can, as of now, be fined up to €3,000. This number is somewhat small, especially when thinking about the differing values of the homes and their respective taxes. The Revenue Commissioners are aware of this, and are looking to create a system that would hold people accountable for the entirety of the tax they avoided. 

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