An annual Local Property Tax (LPT) charged on all residential properties in the State came into effect in 2013. The LPT is collected by the Revenue Commissioners.
- Who is liable to pay LPT?
- Background to the Tax
- The Local Adjustment Factor
- Local Property Tax Allocation 2022 – Limerick City and County Council
If you own a residential property in the State, you are liable for payment of the tax. (This includes local authorities and social housing organisations).
Residential property is any building or structure (or part of a building) which is used as, or is suitable for use as, a dwelling and includes grounds of up to one acre. The LPT does not apply to development sites or farmland.
The tax payable is based on the market value of relevant properties. The LPT is a self-assessment tax so you calculate the tax due based on your own assessment of the market value of the property. Revenue does not value properties for LPT purposes but provides guidance on how to value your property.
Revenue offers a range of methods for paying the tax. You can opt to make one single payment or you can phase your payments in equal instalments. You can log in to the LPT On-line system to view your Local Property Tax record and to pay any arrears (using your PPSN, Property ID and PIN). You can also access LPT through Revenue's myAccount and ROS services.
In January 2012, the Government established an Inter-Departmental Group on Property Tax. This Group considered the design of a property tax to replace the Household Charge. The legislation governing the tax is Finance (Local Property Tax) Act 2012 as amended by the Finance (Local Property Tax) (Amendment) Act 2013 and consolidated in the Finance (Local Property Tax) Act 2021.
The Finance (Local Property Tax) (Amendment) Act 2021 was signed into law on 22 July 2021 and came into operation on the same date. The Act gave effect to a package of measures in line with the Programme for Government to address the future of the Local Property Tax.
The Act introduced the new bands as highlighted below in Table 1, which came into effect for the Local Property Tax 2022. The new valuation period began on 1 November 2021 which is running for 4 years and triggered an obligation on liable persons to submit returns for the year 2022 by 7 November 2021. Provided the LPT is paid and the liability or payment method doesn’t change, no further returns will need to be submitted to Revenue until 7 November 2025
Section 17 of Finance (Local Property Tax) Act 2012 was amended as per the new Act providing for the methodology for charging LPT. This comprises the use of a formula applying the tax rate to an amount that is the mid-point of a particular valuation band. In the case of properties valued at over €1million, the actual value is used instead of valuation bands. The standard tax rate of 0.18% is applied to the amount up to €1million and a higher tax rate of 0.25% is applied to the amount over €1million. The amendment to section 17 involves the substitution of a revised tax rate and the table containing the valuation bands with a series of wider bands. The number of bands is maintained at 20. Band 1 is expanded from €1 to €200,000 and Band 2 contains values in the range €200,001 to €262,500. The LPT charge is fixed at the current charge for Bands 1 & 2 (€90 and €225 respectively). The other bands are widened by 75% to create bands of €87,500 (increased from the current range of €50,000). For properties in bands 3-19, a mid-point rate of 0.1029% is charged. Properties in bands 12- 19 (between €1m and €1.75m) are charged a mid-point rate of 0.1029% on the first €1.05m and 0.25% on balance over €1.05m. Properties in Band 20 are charged on individual property price as before, with a higher rate of 0.3 per cent applied on the value in excess of €1.75million (0.1029 per cent on first €1.05m, 0.25 percent 12 between €1.05m and €1.75m, and 0.3 per cent on the balance
The table below gives an indication of the rate of Local Property Tax for an average household in Limerick following a 15% decrease or increase on the 'basic rate'/ charge.
|€200k Band 1 +75% (includes higher midpoint rates for bands 12-19)|
|1||1 – 200,000||€90||€76.50||€103.50|
|2||200,001 – 262,500||€225||€191.25||€258.75|
|3||262,501 – 350,000||€315||€267.75||€362.25|
|4||350,001 – 437,500||€405||€344.25||€465.75|
|5||437,501 – 525,000||€495||€420.75||€569.25|
|7||612,501 - 700,000||€675||€573.75||€776.25|
|9||787,501 – 875,000||€855||€726.75||€983.25|
|10||875,001 – 962,500||€945||€803.25||€1,086.75|
|11||962,501 – 1,050,000||€1,035||€879.75||€1,190.25|
|12||1,050,001 – 1,137,500||€1,190||€1,011.50||€1,368.50|
|13||1,137,501 – 1,225,000||€1,409||€1,197.65||€1,620.35|
|14||1,225,001 – 1,312,000||€1,627||€1,382.95||€1,871.05|
|15||1,312,501 – 1,400,000||€1,846||€1,569.10||€2,122.90|
|16||1,400,001 – 1,487,500||€2,065||€1,755.25||€2,374.75|
|17||1,487,501 – 1,575,000||€2,284||€1,941.40||€2,626.60|
|18||1,575,001 – 1,662,500||€2,502||€2,126.70||€2,877.30|
|19||1,662,501 – 1,750,000||€2,721||€2,312.85||€3,129.15|
|Rate = 0.1029% (fixed charge in first and second bands)|
Table 1: Current Band Structured
Since 2015, local authorities can vary the basic LPT rate on residential properties in their administrative area. The basic rates of LPT are 0.18% and 0.25%. These rates can be increased or decreased by up to 15% (both rates must be adjusted by the same amount). This is referred to as the local adjustment factor.
The introduction of the local adjustment factor means that residential properties of the same value in different local authority areas may pay different amounts of LPT from 2015 on, depending on whether the local authority has applied a local adjustment factor or not.
If a local authority passes a resolution to vary the basic LPT rates of 0.18% and 0.25% for 2023, Revenue must have been notified of the local adjustment factor on or before 15 October 2022. The local authority must also publish a notice of the variation of LPT on its website and in at least one local newspaper. (Copy of this Notice of the passing of the resolution to vary the rate of local property tax for 2022 is available here.) Revenue then adjusts the LPT liability for residential properties within the local authority’s administrative area.
Local Property Tax (LPT) is now a key funding source for Local Government, replacing the General Purpose Grant funding allocation. The initial allocation under this funding heading was confirmed as €17,554,464. The basis of this funding is an allocation of 80% of the LPT collected from property owners in the city and county and retained by the Local Authority with the remaining 20% being paid into an equalisation fund from which payments are made to counties not achieving a level of funding equivalent to the 2013 General Purpose Grant (GPG) through their own LPT receipts.
The Local Government Reform Act 2014 and associated regulations permits the members of the Council to vary the rate by a maximum increase or decrease of 15%. The Council decided to adjust the LPT rate upwards by 15% for 2022.
The 2022 allocation from the Local Property Tax and the calculation provided by the DHPLG on the basis of this allocation is set out in Table 1 below:
Table 1 - LPT Reconciliation
|Limerick City and County Council - 2022 LPT Allocation|
|LPT 20% to Equalisation Fund||(€3,197,392)|
|=> LPT 80% Retained Locally||€12,789,565|
|Distribution from Equalisation Fund||€4,764,899|
|Original LPT Allocation||€17,554,464|
|15% increase in LPT rate||€2,389,043|
|Revised LPT Allocation||€19,952,507|
The +15% LPT variation for 2022 of €2,398,043 has been allocated to provide additional resources for the delivery of the following services as follows in Table 2.
Table 2 - 2022 Allocation of Additional Resources +15% Variation in LPT
|Svc||Service Description||LPT 15% Allocation 2021|
|B03 & B04||Own Resource element of Local & Regional Roads including Capital Investment New Plant to Deliver efficient Local resources||€778k|
|B0601 & B0602||Traffic Management||€200k|
|Urban & Rural Regeneration||€550k|
|F0301||Maintenance of Parks, Pitches & Open Spaces||€140k|
|D05||Additional GMA for 2022||€200k|
|D0501||Tourism Development & Promotion||€151k|
If you are unhappy about the way in which Revenue has handled any aspect of your tax affairs you can contact the Office of the Ombudsman. The Ombudsman's staff examine complaints about the administrative actions of government departments and offices, including Revenue.
In general, because LPT is a self-assessed tax, formal appeals only arise in a small number of situations.
If you do not agree with a Revenue Estimate you can displace it by submitting a return with your own self-assessment.
Since Revenue has compiled a register of residential properties from various sources, there may be errors about ownership of some properties. If you got a LPT Return form and you do not consider yourself a liable person for that property you should notify Revenue in writing within 30 days of receiving the letter. You should include an explanation of why you do not consider yourself a liable person, the details of the person you think is the liable person (name, address and PPS Number) and supporting documentation. It is very important that you contact Revenue since if the error is not corrected you are liable to pay the tax. Revenue will use the information you supply to make a determination on whether you are a liable person. If you do not agree you can appeal this determination to the Appeal Commissioners.
If you disagree with Revenue on other matters (for example, whether the property is residential, the valuation or whether you can defer payment) and the matter cannot be resolved, Revenue will issue a formal Notice of Assessment or a formal decision on the matter to you. Your right to appeal to the Appeal Commissioners will be set out clearly on the notices. However, you must make a return and pay any tax due before you can appeal the Notice of assessment or any other Revenue decision.
Where to apply
The Revenue Commissioners
Local Property Tax (LPT) Branch
PO Box 1
Phone: +353 (0)1 7023049
Locall: 1890 200 255