Reminder - LPT – New valuation period
A new valuation period for Local Property Tax (LPT) commenced on 1 November 2021 and will apply for the period of four years from 1 January 2022 to 31 December 2025.
Revenue has not yet finalised revised guidelines for the transfer of property during the new valuation period, but as soon as these are available, the Conveyancing Committee will review them and will issue guidance to the profession.
Amongst the significant changes that have been brought about by the Finance (Local Property Tax) (Amendment) Act 2021 are:
- The exemption from LPT that previously applied to builders’ trading stock is no longer available beyond 2021. If builders or developers have houses suitable for use as a dwelling on a liability date (i.e. 1 November in any year), they must now register them with Revenue and, as owners on the relevant liability date, must pay the LPT due in respect of those properties. A builder or developer who owns a house suitable for use as a dwelling on a liability date is in respect of that (finished) house in the same position as any other owner of a residential property.
A property which becomes suitable for use as a dwelling after 1 November in any year in a valuation period will not be liable for LPT until the following 1 November. The property will be valued as of the valuation date for the valuation period – this is 1 November 2021 in the current valuation period. For example, if a new house is built and becomes suitable for use as a dwelling on 1 July 2022, the property will become liable to LPT for the first time on 1 November 2022 but the valuation date is 1 November 2021.
- To facilitate builders and developers, Revenue has set up a new service on its website for the registration of properties that are completed between liability dates. There is no obligation on a builder or developer to avail of this service. Houses that are completed and become suitable for use as a dwelling after 1 November in any given year do not require an LPT ID number in order to stamp the deed of assurance.
Interest on deferred liability
Revenue has advised that a change has been made whereby, since 25 October 2021, interest on deferred liabilities will be calculated on a weekly basis and the amount of interest due will be reflected in the liable person’s online records and also on the Property History Summary screen. In other cases (i.e. where there are arrears for the previous period), solicitors should continue to exercise care when there are arrears of LPT showing on the LPT Property History Summary as the interest due in respect of such arrears is not reflected on the Property History Summary. Solicitors are referred to the Practice Note issued by the committee on 2 July 2021 in this regard.