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Local Property Tax changes in 2021

8th June 2020

The Department of Finance says most homeowners will not face any increase in their Local Property Tax (LPT) bills, following changes in rates and bands published on 2nd June 2021.

The Minister for Finance, Paschal Donohoe, published the proposed changes in the heads of the Finance (Local Property Tax) (Amendment) Bill 2021, after approval from Government.

The rate of the tax is to be cut and the bands will be widened in order to maintain the structure of the tax, and to minimise the effect on homeowners.

Revaluations every four years

Properties will be revalued on 1 November 2021, with valuations to be reviewed subsequently every four years. This year’s revaluation will be the first since the tax was introduced in 2013.

Around 100,000 properties built since 2013, which were previously exempt, are being brought into the LPT net. The measures are expected to bring in an extra €560 million.

Another key change will allow local authorities to keep 100% of the LPT collected in their area.

All new residential properties built between valuation dates will be retrospectively valued as if they had existed on the preceding valuation date.

Bands widened by 75%

“Where increases arise, the majority will be a single band (€90), notwithstanding the significant increases we have seen in property values since 2013,” said Minister Donohoe.

Properties are still divided into 20 bands, with the charge for the two lowest remaining at the current rates of €90 and €225 a year, respectively.

The remaining bands are being widened by 75% to create bands of €87,500. The rate for most properties is 0.1029%, rising to 0.25% on the portion of any valuation above €1.05 million. There are separate arrangements for properties in the most expensive band (band 20).

The Minister aims to have the bill enacted before the summer recess to enable Revenue to prepare for implementation of the changes, ahead of the revaluation of properties in November 2021.