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Property Tax Collection

Dáil Éireann Debate, Wednesday - 7 May 2014

Wednesday, 7 May 2014

Ceisteanna (32)

Michael McGrath

Ceist:

32. Deputy Michael McGrath asked the Minister for Finance the number of refunds that have been completed for second-hand home buyers who were incorrectly charged the local property tax in 2013; when the process will be completed; and if he will make a statement on the matter. [20408/14]

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Freagraí scríofa

The legislation governing the administration of Local Property Tax (LPT) provides for a number of exemptions from LPT, one of which is relevant to those who purchased a residential property during 2013. This relates to the exemption under section 8 of the Finance (Local Property Tax) Act 2012 (as amended), which is the exemption to which the Deputy refers. It was originally intended that this exemption would only apply to first-time buyers, however, the exemption was deemed by Revenue to benefit any buyer, not just a first-time buyer.

The relief is available to a person who purchased a second hand house in 2013 and occupies it as a sole or main residence. The exemption will apply up to the end of 2016, provided the purchaser does not sell or otherwise transfer ownership of the property and continues to live in it as his or her sole or main residence. Accordingly, there will be some occasions where a purchaser of a second hand property in 2013 will not qualify for the exemption, for example, where the property is being let by the purchaser.

Revenue has advised me that the section 8 exemption applies to a clearly defined group of property owners within three broad categories:

(1) Those that purchased a residential property between 1 January 2013 and 1 May 2013 and paid the 2013 LPT liability. These purchasers may be entitled to a refund of the 2013 payment and, subject to certain conditions, may be exempt for 2014 to 2016 LPT;

(2) Those that purchased a residential property between 2 May 2013 and 1 November where the purchaser paid the 2014 LPT liability. These purchasers may be entitled to a refund of the LPT for 2014 and, subject to certain conditions, may be entitled to an exemption for 2015 and 2016 LPT; and

(3) Those that purchased a residential property between 2 November 2013 and 31 December 2013. These purchasers, subject to certain conditions, may be entitled to an exemption for 2015 and 2016 LPT.

Revenue has made significant progress in identifying individuals who bought in 2013 and who may be entitled to claim the exemption. It is estimated that approximately 3,000 property owners may be entitled to relief under Section 8. Revenue has written to approximately 1,500 property owners and 600 claims to exemption have been submitted. It is evident, on foot of the contacts already made, that many individuals who purchased properties in 2013 do not meet the qualifying conditions for the relief.  Up to half of the claims received have resulted in refunds or in offset of some or all of the overpayment to the property owner's LPT liability (on another property) or to satisfy other tax liabilities.

Revenue will contact the remaining 1,500 individuals in the near future to invite them to submit claims to exemption should they qualify for relief.  Revenue has also advised that an accurate timeline for the completion of the process will only be available when those who are contacted respond by claiming the section 8 exemption for 2013 and/or 2014, as appropriate.

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