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Budget 2013 – The property implications

It was no surprise to many that a property tax was introduced in today’s Budget. The introduction of the new charge on households had been earmarked for over a year

What other implications had today’s Budget got on property though and what will you pay? MyHome.ie has developed a property tax calculator which will help you determine your annual repayment.

We’ve also summarised other changes below:

–       A property tax has been introduced at a rate of 0.18% for properties valued up to €1 million and at a rate of 0.25% for properties valued at over €1 million.

–       The tax will be based on the market value as assessed by the owner of the property. You can use MyHome.ie’s Property Tax calculator to get a rough guide of what you will pay. The Revenue Commissioners, who will be collecting the property tax, will also provide a valuation guide to help people make a fair assessment.

–       Properties with a value of more than €100,000 will be assessed at the mid-point of the valuation band. So, for example, a property valued between €150,001 and €200,000 will be assessed at 0.18% of €175,000. Properties valued below €100,000 will be assessed at 0.18% of €50,000.

–       The rates of 0.18% and 0.25% will not change during the lifetime of the current government.

–       Initial valuations will be valid up to and including 2016.

–       First time buyers will be exempt from the property tax for four years.

–       Anyone who buys a previously unoccupied home will be exempt up until the end of 2016.

–       As with the household charge, certain properties will be exempt from the charge. This list has not yet been determined but is likely to include the likes of ghost estates etc, which were also exempt from the household charge.

–       A deferral period is also available up until the end of 2017 for those on low incomes.

–       Revenue will strictly enforce the new tax and collect any outstanding money owed on the household charge. Arrears on it not paid by July 1st 2013 will be increased to €200.

–       From 2014 PRSI will be payable on income generated from wealth, including rental and investment income

–       The NPPR or second home charge will be abolished form January 1st 2014.

–       Local authorities have the power to vary rates, however, based on their funding needs.

There are 14 comments for this article
  1. Edward at 11:20 am

    While we may own the bricks and mortar that our houses are built on, we do not own the land ever, the land actually belongs to the state as they own Ireland. So all you foolish people that think you own what you own…you do not, if you did, how come the government can have a compulsory order to take your land when they want to do something.

  2. Mark at 3:16 pm

    As always in Ireland we are blind to the connection between the cost to the state of providing services and need to collect taxes to pay for those services. We cannot on the one hand complain when services are poor and at the same time complain when the state tries to collect taxes to pay for and improve services. Every modern country has a property tax and we should be no different. The cost is modest at 0.018% of the value and the majority of people will pay less than €10 per week. A modern progressive tax system should tax assets and not labour but in Ireland when attempts are made to do this a section of people get very vocal many of whom are either working in the black economy or are self employed and underpay their taxes. As for the comments about 800 years of British rule – yawn

  3. dermot at 2:08 pm

    We all have our issues with this property tax. for some here it’s the large stamp duty that was paid in recent years and now having to pay again.
    I come here from the point of view of a landlord.
    I have two rental properties which I believed were an investment. Now they’re becoming a liability.
    I have good tenants and I look after them, but rents are poor. Many years ago, when I was a child, my father had a house with a sitting tenant. The rent he received was barely more than the rates! Could it get that bad again??
    It’s not realistic to pass on this tax to the tenants as the law clearly requires the owner to pay even though the tenants enjoy the same services that this tax is paying for.
    The state will apply pressure where they can, as long as there is no resistance. A hundred years ago, people were able to organize to resist against draconian laws without the modern communications we have today. Perhaps its time to take risks again, in order to secure a better future for our children. An organized national strike with clear and achievable demands (unlike the anti household charge campaign) and without the input from ANY politician, who just want to feather their own nest.

  4. Patrick at 12:25 pm

    How very,very Sad. Pre last general election our opposition parties said this penalization of our tax paying citizens was immoral and that in no way when elected would this translate into policy. Yes we all believed not another cent to the Bankers/Bondholders.(Who said That?)Why did we believe that this outfit would do anything other then maintain the status of what we have we hold. In a country where we have two major conservative parties, and the rest do as directed.Fortunately the ousted party are when possible,left of center,and as such more in tune with the social needs of the people. When will we ever learn. Enough Bankers & Bondholders.Yes the horses have changed RIDERS,that is all. When you look across the pond, and see what their citizens get for the household taxes,and compare what we do not get for our rates.Yes we have gone downhill ever since the previous riders left us, and to think so many died for THIS so called Democratic country. God Speed our young immigrant children,I know parting is painful, but you will be rewarded for your good education and skill, and do come home when you can .

  5. James keeley at 12:02 pm

    I AGREE WITH JIM HOGAN , I PAYED 60K IN STAMP DUTY IN 2008 ON MY HOME , THIS 60K IS REALLY 125K OVER THE NEXT 25 YEARS , THE VALUATION OF MY HOUSE IS GONE DOWN BY 65 % AND IM STRUGGLING TO PAY THE MORTGAGE PLUS IM SELF EMPLOYED AND IM CRIPPLED WITH OVER HEADS LIKE COMMERCIAL RATES ETC WHICH I HAVE ALWAYS PAID , REMEMBER PEOPLE THESE POLITICIANS DONT FEEL THE PAIN LIKE THE REST OF US BECAUSE WHAT THE BORROW FROM THE TROICKA PAYS THEIR BLOATED WAGES SO IN ESSENCE THEY ARE OBEYING THESE GREEDY BONDHOLDERS BECAUSE IF THEY DONT , OUR FAT POLITICAINS DONT GET PAID ,WE HAVE LOST OUR COUNTRY TO PAPER MONEY THAT NEVER EXISTED , GREAT STROKE FROM THE GERMANS , AND US CABBAGES ARE PAYNING WITH OUR CHILDRENS FUTURES ,THINK PEOPLE , LISTEN TO STEPHEN DONNELLY SPEECH IN THE DAIL YESTERDAY . THAT SUMS THING UP

  6. DenisScannell at 7:30 am

    What about incentives instead of constants threats, do they think we aren’t noticing the language and getting a small bit fed up of it. we know the country has been bankrupted by lazy overpaid parish pump politicians, we know we have to bail the bankers out, they don’t need to bully us into it.

  7. DenisScannell at 7:23 am

    Here is the problem

    “Local authorities have the power to vary rates, however, bases on their funding need”.

    A blank check to another inefficient organisation

  8. Fiachra at 5:00 am

    I agree with Peader here. Is this what our 800 years of struggle were for? However, I do not feel sorry for anyone who voted Fine Gael , or for the matter Fianna Fáil. You all voted for these idiots and will continue to do so until they have us on our knees and we will actually think that they are our superiors. They are not! We are their employers. Take back our power. Take back our pride. Take back our country. We need to start voted alternative parties. None of the others worked out. In fact, we should vote Independents so that they are more reliant on us for their power and ‘jobs’. Besides, the more opinions there are, the better. I am sick of Irish people ruining my life by voting in a bunch of sheep who just follow their leader.

  9. Nuala Riordan at 9:14 pm

    I am disgusted with this Government’s BULLY tactics, following the same path as their criminal predecessors, at continuously picking on the VULNERABLE and not even showing shame at their own extravagant incomes – which can easily take the cut backs and tax hikes without even noticing. There has been NO ACKNOWLEDGEMENT of this or even a thought to cutting their own income in a stringent PRO-RATA of those they are picking on ! I paid over 25K on a property, which is in negative equity now and I am now due to their cutbacks unable to afford my mortgage, let alone a property tax
    !

  10. wayne at 8:48 pm

    Just bought my first house before 2012 ends so I could get the mortgage interest relief for the next 7 years. Has this budget ended any hope of me getting interest relief in 2013

  11. Peadar MacMillan at 6:26 pm

    Hello – so we no longer own our own properties. I stupidly thought that the 800 year struggle against British rule in Ireland and in which some of my wifes and my own ancestors died, was basically about being able to own ones own property and determine ones own path in life. Now, if we do not pay this property tax and the amount eventually acrues to the value of the property, then the state/stasi, effectively becomes the new owner of your property. Thats wonderful.
    Talking recently to a Fine Gael politician, Flanagan, he said to me in relation to our history , that ” That is all in the past”. He was wrong, the past just keeps repeating itself in this country of stale and stagnant politics. I am just wondering will the state eventually evict someone in years to come. I think there are still some ramming poles at the State museum that they could use to knock in the front doors. This would save money on new battering rams and create employment for eviction bailifs – no – perhaps they are cleverer than I thought.
    Mr Flanagan also stated that most other European countries have a property tax – most Europeans rent – the taxes by and large are paid by investment companies – not individuals. Remembering our ancestors and all they struggled for.All is nought.
    Peadar MacMillan.

  12. jim hogan at 5:54 pm

    I generally agree that a Property Tax should be introduced, in line with most EU Countries
    However I STRONGLY argue that relief from this tax should be allowed to those who paid Stamp Duty in recent years, and an EXEMPTION must be lobbied for in this regard.
    As an example I paid over 40,000 euros Stamp Duty for my house beginning of 2008, which has halved in value since that time

  13. alan Kennedy at 5:53 pm

    TOTAL DISGRACE, I WANT MY STAMP DUTY BACK!! THEN I;LL PAY, MAYBE.

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