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 scope within which the tax is charged to homeowners will be broadened significantly, increasing the number of homeowners liable to pay LPT.
Approximately one third of homeowners will see an increase in the charge per year; just over half of homeowners will not have any change in their LPT charge and the charge for 11% of homeowners will be reduced. The increase works by moving homeowners to a particular “band”, and the tax is charged depending on which band a homeowner is in.
Previously, LPT was not charged on any properties built after 2013, however with the new system homeowners of these properties (100,000 of them) will now be liable to the tax and no longer exempt. The basis on which new builds will be calculated is available on the Government website here.
Properties subject to LPT will be re-evaluated in November every four years, rather than three years which is the current review period. The new charge is expected to apply in November 2022.
About the author: Nicola Walsh, Partner and Head of Property.