THE GOVERNMENT has published a Bill which proposes several amendments to the Property Tax scheme which kicks in from July.
Chief among the changes is the legal exemption for properties suffering from pyrite problems. The scheme proposes that houses will need to be certified by the National Standards Authority of Ireland as suffering from ‘pyritic heave’; when they are, the property will be exempt for at least three years.
Exemptions will also apply to people who have received a personal injury award and who need to spend a significant sum adapting their home to make it inhabitable. This will apply for as long as the injured person lives at the property concerned.
Any increase in the value of a home as a result of works to accommodate a disabled person can be ignored; this means that if a house becomes more valuable as a result of the works, its previous (lower) value is the one on which the tax is calculated.
Other changes will see legal permission for a deferral of the tax in cases where the owner of a property has deceased and the tax would be due from their estate. This will give estates up to three years to be processed and to meet their obligation.
This will also apply to someone who is in the middle of an insolvency arrangement under the new Personal Insolvency Act, and anyone who can satisfy the Revenue Commissioners that they have experienced a “significant financial loss” or expense which they could not have significantly foreseen.
Among the changes is some good news for local authorities: all housing owned by councils or approved housing bodies will be subject to tax at the lowest possible valuation for the next four years.
This means a flat rate of €90 per property instead of €315, for example, if the house was worth between €150,000 and €200,000.
An exemption will also apply to residential properties owned by charities which are normally used to help the charity carry out its duties – such as residential properties owned by scouting organisations where scout meetings are held.
Another minor change in the Bill provides that someone selling a property between two valuation dates is obliged to disclose its property tax valuation to its new purchaser – a move the Department hopes will incentivise against under-declaring the value of a home.
If a purchaser believes the home has been deliberately undervalued in previous years, they are required to submit a return to the Revenue Commissioners before the next valuation date. The Revenue will then pursue the seller for the shortfall.