I propose to take Questions Nos. 103 and 112 together.
Section 10A of the Finance (Local Property Tax) Act 2012 (as amended) provides that an exemption from the charge to Local Property Tax (LPT) will apply for a temporary period of at least three consecutive years for residential properties that have been certified under Regulations made by the Minister for the Environment, Community and Local Government as having “significant pyritic damage”.
The Finance (Local Property Tax) (Pyrite Exemption) Regulations 2013 require that residential property owners demonstrate significant pyritic damage in accordance with the recently published standard by the National Standards Authority of Ireland, I.S. 398 – Reactive Pyrite in sub-floor hardcore material – Part 1. This standard provides guidance on the Building Condition Assessment, as well as on the sampling and testing to be carried out, to establish the presence of significant pyritic damage.
To be eligible for an exemption from LPT, a liable person must obtain a certificate from a competent person, such as an engineer, confirming the presence of significant pyritic damage and cannot claim the exemption until the relevant certificate has been issued in respect of the residential property concerned. Once they have the relevant certificate, the liable person should notify the Revenue Commissioners in writing that they wish to claim the exemption. By virtue of the LPT legislation, the liable person can, as it suits their particular circumstances, opt to claim the exemption from that date forward or retrospectively if they received the certificate after they had already met their LPT obligations for a particular liability date.
Special arrangements will apply in respect of the years 2013 and 2014. Liable persons who do not have the relevant certificate on the first liability date of 1 May 2013 (liability date for 2013), or by 1 November 2013 (liability date for 2014), will be required to pay LPT for those periods. Where a certificate is issued after either of these dates but on or before 31 December 2013, a liable person may elect for retrospective exemption for one or other of the years 2013 and 2014. This election must be made on or before 31 January 2014. Where a liable person elects for retrospective exemption for the years 2013 or 2014, any LPT that has already been paid will be refunded by Revenue. Any refund is subject to Revenue’s usual four year time limit on the refund of tax.
Depending on when in a three year valuation cycle the certificate is issued, the exemption may last for up to five years. It is the date of the certificate and not the date of the claim for the exemption that determines when the exemption first starts from. Where a property qualifies for the exemption, it continues to apply even where the property is subsequently remediated before the end of the exemption period.
For those persons who have previously paid for tests to be carried out, I am advised that, conscious of the need to reduce costs to liable persons who own properties with significant pyritic damage, the Regulations provide for the use, where feasible, of the results from testing of the sub-floor hardcore undertaken prior to the publication of I.S. 398-1:2013, to classify the hardcore material, if the testing that has already been carried out is in accordance with, or equivalent to, the test methods provided in this standard, and this has been validated as such by a competent person. However, a Building Condition Assessment, in accordance with I.S. 398-1:2013, will be required to be carried out by a competent person irrespective of when the testing is, or was, carried out. Affected homeowners may be eligible to recoup the cost of the Building Condition Assessment, subject to a maximum limit of €500 (including VAT), under the pyrite remediation scheme currently being developed by the Pyrite Resolution Board.
The rules governing when, and for how long, the exemption applies are complicated and are best explained by the use of examples. I am advised that further detailed information and examples on how the exemption for residential properties with significant pyrite damage operates are provided by the Department of Environment, Community and Local Government, on www.environ.ie, or can be accessed from the LPT pages of the Revenue website, www.revenue.ie.