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Ireland Announces LPT Amnesty

by Jason Gorringe,, London

24 February 2014

Ireland's revenue authority will give property owners one final opportunity to bring their Local Property Tax (LPT) and Household Charge affairs up to date, before the launch of a nationwide compliance program.

Residential property owners who have so far failed to pay their 2012 Household Charge or 2013 and 2014 LPT, or have undervalued their property or claimed an exemption they were not entitled to, will be given until March 31 to put their affairs into order.

After this date, interest will be charged on outstanding LPT (including Household Charge arrears) at a rate of 0.0219 percent per day, from the date the tax was due. The Household Charge and the 2013 LPT were due on July 1, 2013; the 2014 LPT was due on January 1, 2014. Interest will also apply where additional tax becomes payable in cases where a property was undervalued.

From April, Revenue will enforce a mandatory deduction of unpaid Household Charge from wages and occupational pensions. The deduction will include interest. Appropriate cases will be selected for debt collection/enforcement action.

The 2013 LPT compliance rate currently stands at 93 percent, and EUR242m (USD332.9m) has been transferred to the Exchequer in respect of the half year charge. The 2014 compliance rate is lower, at 82 percent.

Revenue expects to see an increase in the compliance rate as the 40,000 items of correspondence from late last year are processed. The Exchequer figure – currently EUR110m – will rise incrementally throughout the year, as the various phased payment arrangements kick in and a single debt authority option is implemented.

To date, 190,000 reminder letters have been issued, and over 29,000 mandatory deductions from wages/pensions initiated. More than 6,700 income tax surcharges have been applied.

LPT project manager Vivienne Dempsey said: "By the end of March, we expect to have the remaining 40,000 items of LPT correspondence cleared and to have finished the automated matching of the Household Charge register from the [Local Government Management Agency] with our LPT register. LPT staff will then be increasingly assigned to tackling LPT non-compliance."

TAGS: compliance | tax | pensions | Ireland | property tax | interest | revenue guidance | enforcement | tax authority | tax rates | revenue statistics

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