Calculations | 

Up to 380,000 homeowners defy Revenue rules by failing to update property tax home values

Around one in five homeowners have not provided a new valuationThe revelation comes as the tax is due on Wednesday for those who pay by cash or cheque
Niall Cody, Chairman of the Revenue Commissioners Photo: Tom Burke

Niall Cody, Chairman of the Revenue Commissioners Photo: Tom Burke

Charlie Weston

Hundreds of thousands of homeowners have defied Revenue by failing to provide a new property tax valuation for their homes.

Calculations based on figures from the tax authority show that 380,000 homeowners have so far failed to file a new return to Revenue valuing their homes for tax.

This means around one-in-five homeowners have not provided an updated valuation, with some likely to be underpaying the tax.

The revelation comes as the payment of the tax is due on Wednesday for those who pay by cash or by cheque.

Last year, Revenue asked every homeowner in the State to file a return with a new valuation for their home by the first week of November.

The fact that so many have failed to file a return with an estimate of the latest value of their home means some of these people are likely to be underpaying the tax.

Revenue has stressed that even among people who have failed to file a return with a new valuation for their home, some have been paying the tax since it was introduced.

But their failure to provide an updated valuation means they are paying the local property tax (LPT) based on the 2013 property valuations.

The tax rate was lowered from this year and valuation bands widened.

This means not everyone will pay more tax despite the surge in house values in the decade.

But officials are anxious to have an accurate picture of home values, to ensure people are not underpaying.

Revenue chairman Niall Cody said: “The return compliance rate for LPT for 2022 currently stands at 81pc, while the payment compliance rate is 91pc.”

He added: “I strongly encourage property owners who haven’t yet paid, or made arrangements to pay, or haven’t already filed their LPT return to do so now.”

The fact that only 82pc of the estimated two million homeowners have complied by filing a return with a new valuation means around 380,000 have yet to do so.

Asked what sanctions would apply to those who do not provide a new valuation, Revenue said a number of homeowners had been in contact with it, attempting to file a return.

Some have issues around confirming ownership of the homes.

It said it recognised that some people were under financial pressure at the moment.

It would look at imposing sanctions for non-compliant homeowners when the pandemic eased off.

And Revenue has insisted, despite claims, that most people are not trying to “game” the tax by deliberately undervaluing the homes.

The latest statistics show that 54.2pc of those who filed a return with a new valuation have said their home is worth less than €262,500.

This is despite property prices surging by 13.5pc in the year to October.

A number of people said on RTÉ’s Liveline that they had deliberately undervalued their homes because they did not agree with the tax.

Research carried out by the tax authority shows that the LPT valuations provided by property owners track very closely to the prevailing average sales.

“In the vast majority of local authority areas, the sales price average falls within the average LPT band,” a spokeswoman said.

The average valuation band for LPT properties is €200,001 to €262,500.

Revenue research found the average sales price at the end of last year was €295,000.

“Minor differences between LPT valuations and the most recent sales prices are to be expected given the nature of the two data sources being compared and the characteristics of Ireland’s property ­market,” the research said.

People who chose to pay the tax for a full year by cash or cheque have to do so by Wednesday.

The tax is due to be deducted from this month from wages and pensions for those who are paying the tax in phased instalments.

Regular cash payments though a payment service provider are also being deducted.

From January 15, monthly direct-debit payments start and continue on the 15th day of every month.

Anyone who pays by credit or debit card will have the amount deducted from the card accounts as soon as they complete the transactions.

Those who have opted for an annual debit instruction will see the money come out of their bank account on March 21, unless they specify it is to come out before that date.

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