June 21, 2021
Proposed changes to Local Property Tax
The Minister for Finance announced proposed changes to the Local Property Tax (“LPT”) recently. All homes will be re-evaluated under the new regime. The rate is being cut, however the...
The Government has announced an increase of 10% in the stamp duty charge on the purchase of residential property where ten or more residential units are being acquired.
Currently in Ireland, stamp duty on residential property is 1% for a purchase under €1,000,000 and 2% on the part of the consideration which exceeds €1,000,000.
The increase to 10% will be triggered on the purchase of the tenth property – both in bulk purchases of ten or more houses, and in ten purchases of ten separate properties within the State over a cumulative basis within a twelve-month period.
The increased rate will apply retrospectively to the other 9 units on the purchase on the tenth unit. Any properties acquired prior to 20 May 2021 will count towards the threshold of ten units, but the 10% rate will apply only to the units acquired on or after 20 May 2021. Any payment of stamp duty on the properties acquired prior to this date will be offset against the increase.
The financial resolution governing the new measures provides that, for the purpose of the ten-unit threshold, residential units acquired by a “connected person” shall be taken into account. The definition of connected person for this purpose is wide and should be reviewed carefully.
The Government has allowed for a 3-month transition period from 20 May 2021 for the execution of contracts that have been entered into but have not yet completed; however these sales will have to complete before 20 August 2021.
The following are outside the scope of the increased rate:
About the author: Nicola Walsh, Partner and Head of Property.
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