LOCAL PROPERTY TAX
SELLING YOUR HOUSE?
CHECK YOUR VALUATION BAND
If are thinking of selling your house, or actually in the process of selling it now, you will need to satisfy the Revenue Commissioners that you have paid the correct Local Property Tax, or face a delay in sale closure if your house sells for greater than 15% of the original valuation stated on your Local Property Tax return form.
In July 2014, The Revenue Commissioners published
a report stating that around 42 % of people
self-assessed their properties and agreed with the LPT
valuation band that Revenue had placed their house in.
14 % estimated a higher band and, most significantly
for intending vendors, 44 % of people decided that the
Revenue estimate was too high and submitted their LPT
return with their house placed in a lower valuation
In order to clarify the situation for intending house sellers,
Revenue have stated that:
"The important thing here is the difference between the declared property evaluation and the selling price must be in excess of 15 percent before we need to consider it at all. If we do consider it, it's the original declared value that we're looking at, not the increase in price in the meantime. We're not in the business of penalizing somebody for an increase in value, provided that the original declared value was correct....If the 15 pc differential is there, they should then consider, how did they arrive at the original value? Was the sale price established by reference to neighbouring properties, if it was and again if it was honestly and reasonably made, then there’s no issue."
In excess of 3,900 Irish property owners have revised upwards their property's original valuation band since the Local Property Tax was introduced and hundreds of homeowners have had to pay additional property tax to the Revenue Commissioners to enable the sales process to be completed. In 20 % of cases the property was placed in a valuation band 3 levels or more higher than the original Revenue estimate.
Revenue advises vendors and/or their selling agents to contact them as soon as the sale is agreed in order to establish whether they need to amend the property tax charge. Owners thinking of selling and concerned about the correct valuation figure can self-correct their valuations online.
Based on a recent article in the Irish Times newspaper
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