okay let's talk about taxes today taxes and property
recently i was asked by a lady from outside ireland who's thinking of buying
a property in ireland about the tax situation in safari's
property tax how this property attacks of affect
irish houses or irish residential properties
so there's a couple of taxes you need to be concerned about whether you're buying
or whether you're selling let's just say for the sake of argument
you're buying a property firstly you're going to have an ongoing
local property tax local property tax lpt is an annual tax
based on the valuation of your property so that's the ongoing annual
tax you have lpt prior to that was a forerunner tax of lpt
called nppr tax that's non-principal private residence tax
and that went from 2009 to 2013 and was administered by the local
authority so each county council would have looked after
nppr in the particular county in which the house was located
what you need to be concerned about if you're buying a house second hand house
or the new house but certainly buying a second-hand house you need to be
concerned that there's no outstanding liability
on the property arising from the nppr tax
from 2009 to 2013 or there's no outstanding liability today
in respect of lpt in relation to nppr tax from 2009 to 2013
what you're going to be looking for your solicitor is going to be looking for
is a certificate of exemption from nppr tax
from the vendors solicitor or a certificate of
discharge from the vendor solicitor either of these certificates would be
issued by the local authority so meade county council longford county
council kildare county council wherever if it's a certificate of
exemption we're talking about then obviously the person that was living in
the house is going to have to have applied to the
local authority for an exemption in respect of nppr
and you get this exemption if it was your principal private residence because
remember the nppr tax is non-principal private
residence tax so if a person was living here in
enfield in the house between 2009 and 2013
and it was their principal private residence and they're now selling their
house in 2020. they need to get a certificate of
exemption from me county council confirming that they were exempt from
the tax between 2009 and 2013. on the other hand if there were an
exempt well then you need a certificate of discharge
so that person will have to have paid the nppr tax
at the time or pay it now along with all the penalties and so on
and give you a certificate of discharge so that's lpt which is the ongoing tax
nppr tax between 2009 and 2013 it could be a charge on the property so
it's important that there's no outstanding amount
due to the local authority arising from that tax because it could be a charge on
the property in other words when you buy the property
you could find that there is a charge on it
arising from somebody else's liability that's why you need a certificate of
exemption or a certificate of discharge in relation to lpt local property tax
what's going to happen is if you're buying a property and the sale is going
to close for example on the 1st of september what
you do is vendor and purchaser solicitor will
calculate the n or the local property tax for the year
and they will apportion it then between the time period from the first of the
year up to closing date and from the time
of closing the completion of the sale to the end of the year
and they will apportion down or divide up the local property tax
between the purchaser and the vendor so the vendor will
be responsible and will pay discharges up to date of completion and
the purchaser will be obviously liable for
the balance of the year however what happens in practice is
the vendor will pay for the whole year and then we'll just take the balance
back from the purchaser on completion so the
solicitor simply does a calculation or an
apportionment on closing and they divide up or divvy
up the year's lpt and so both parties pay their fair
share the other tax obviously you need to be concerned about in relation to
property is stamp duty stamp duty is essentially
a transaction tax and it is a tax on the value of the property
and the value of the deed of transfer on the property generally so if the
property is for selling for 250 grand the the transfer is going to say that
the property was transferred for the consideration of 250 grand and
the stamp duty is going to be one percent
that is one percent of 250 grand obviously two 2
500 euros so they are the three main taxes you need to be concerned about
if you are buying or selling a residential property in ireland
if you're selling it obviously you need to get your house in order and ensure
that the lpt is paid bang up to date including for
the entire year in which you are selling and you need to ensure you have a
certificate of exemption or discharge in respect of
nppr and you can get that from your local authority your solicitor will give
you a hand to do that all you do is fill out a form and you do
a statutory declaration for the local authority
and if they are satisfied that you were indeed living in the house for the
period of time in question 2009 to 2013 they'll give you the
certificate of exemption and that's it you're off to the races
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