A new tax on Non Principal Private Residences ( NPPR.ie ) comes into effect in Ireland on 31st July 2009. The 2009 payments are due by 30th September 2009 . One month’s grace is allowed – so any payments made after October 31st will incur the penalty of €20 per month or part month.
The new “NPPR” charge is aimed at property that anyone owns in Ireland that is not used by them as their principal residence. You do not have to own two homes to be liable for this charge. You could be living in a rented house while the home you own is empty or you have tenants in it. It is initially going to be set at €200 a year and is to be used to help fund Local Authorities. The charge is the same for all properties – regardless of size, location or value. The Liability date for 2009 is 31st July – in future years it will be March 31st
The Local Government (Charges) Act 2009 is structured with a starting position of a universal liability for residential dwellings in respect of the charge. It then goes on to exempt certain buildings and owners from this liability.
The main exemption is for principal private residences. No person can have more than one sole or main residence. If you are renting a home and own another property – you are still liable for the NPPR. You don’t have to own more than one house to be liable.
Note : A property that is not suitable for use as a dwelling should not be regarded as dwelling within the meaning of the act . ( A temporary cutting off of the electricity or water supply does not make a property unsuitable)
Other Exemptions:
a) Properties are exempt if they are rented out as part of the RAS (rental accommodation scheme) or rented to the HSE , or leased to a housing authority;
b) Where a person partly occupies a dwelling as his or her sole or main residence, and avails of and is entitled to the Revenue Commissioner’s Rent-a- Room Scheme, no liability for the NPPR charge will apply
c) Charities are exempt
d)Properies that are liable for commercial rates will not be laible for the NPPPr charge.
e)There is also an exemption for Newly Constructed but Unsold Buildings – that are vacant and have never been occupied.
The new property charge is to be paid to a body called the NPPR . You will be able to register your properties and pay the charges online at the nppr.ie website by credit or debit card.
Property owners will also be able to register and pay at your local council offices using an NPPR registration form. The payment types accepted wil be credit card, debit card, bank draft, postal order and cheque.
Late Payment : if the NPPR charge is not paid within a month after the last date for payment, a late payment fee of €20 will apply for every month or part of month that the €200 Euro charge remains unpaid.
The 2009 payments are due by 30th September . One month’s grace is allowed – so any payments made after October 31st will incur the penalty of €20 per month or part month.
From 2010 the charge will be due before March 31st every year.
Landlords Note: Information from Revenue Dept is that the €200 charge is not an allowable expense for calculating rental income.
About €40 million is hoped to be raised by local authorities from this new property tax – but the administration and IT costs of the collection systems required will probably swallow up a lot of that income . It will be interesting to see how much of the revenue is actually used in collecting the new charge.
Property Registration:
It seems that the onus is on property owners to register any properties that are not their principal residence. There is no national housing / address database in Ireland – so it is probably going to be difficult for the local authorities to determine which properties are actually non principal private residences.
The Local Government Charges Bill 2009 allows for the use of information from the Private Residential Tenancies Board , the Revenue department and ESB to assist in the identification of non principal residences. There are probably many landlords who are not even registered with the PRTB – so there may be many rented properties that will be missed unless the owner voluntarily registers them.
Properties in the Rental Accommodation Scheme are exempt. There are also limited exemptions where a person is moving house and, in temporarily owns two houses for a short period.
Full details on www.NPPR.ie where you can register and make payments.