Owners of second homes or investment property in Ireland have been urged to pay the new levy by September 30, 2009, in order to avoid punitive fines and charges.
The tax on second homes, brought in by the Local Government Act 2009, applies mainly to owners of private rental property and holiday homes. It also applies to vacant residential property unless newly-built but unsold. Liability to pay the charge is assessed by the owners themselves. Ownership of a non-principal private residence on the ‘liability date’ (July 31, 2009) determines liability to pay the EUR200 charge.
Payment is due by September 30, 2009, and can be made both online or at the offices of any county or city council. Those failing to pay the tax on time can expect to face a EUR20 per month late payment fee, starting October 1.
“Normally surcharges and penalties for any unpaid tax are much much lower, this amounts to an ongoing 10% fine for every month - while EUR20 may not seem excessive, it is certainly (when viewed in percentage terms) extreme. Especially given that there is not much being published regarding the tax,” commented Mortgage Advisor Karl Deeter of Irish Mortgage Brokers. Adding: “That's the funny thing with tax, ignorance is not a defence, so don’t let the surcharge catch you and end up paying over the odds.”
A comprehensive report in our Intelligence Report series dealing with the issues raised by international property investment, and the possible taxation implications raised by such purchases, with an account of the likely (and some less obvious) potential countries for your consideration, is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report15.asp
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