Jack Chambers (Dublin West, Fianna Fail) | Oireachtas source

The VHT was announced in budget 2023 and legislated for in the Finance Act 2022. The key objective of this tax is to increase the supply of homes for rent or purchase by encouraging the owners of vacant, habitable residential properties to bring those properties back into use. The tax applies to properties which are residential properties for the purposes of local property tax, LPT. Therefore, as with local property tax, VHT applies to habitable residential properties and does not apply to derelict or uninhabitable properties.

The VHT is only one part of a much broader suite of measures being implemented by the Government to address vacancy and bring properties back into use. For example, initiatives such as the vacant property refurbishment grant and ready to build scheme provide financial incentives for people to buy and refurbish vacant properties and sites for their principal private residence. A residential property is within the scope of VHT if it has been occupied as a dwelling for less than 30 days in a 12-month chargeable period. A chargeable period for the purpose of this tax runs from 1 November to 31 October each year. The first chargeable period ended on 31 October 2023. The first self-assessed returns were due on 7 November 2023 and the tax was payable on 1 January 2024. The next returns for the tax will be due on 7 November this year.

For the first chargeable period, the rate of the tax was three times the property’s existing base LPT charge. For the chargeable period ending 31 October 2024 and subsequent chargeable periods, VHT will be charged at five times the property’s existing base LPT charge, as provided for in the Finance (No.2) Act 2023. VHT operates on a self-assessment basis where the number of properties in scope and the amount of tax payable depends on the self-assessed returns submitted by property owners, the number of properties declared as liable and the number of property owners entitled to claim available exemptions from the tax. Revenue has confirmed that, as of June 2024, more than 6,400 properties have been declared as vacant, with exemptions claimed in respect of more than 2,600 of these properties. Approximately 3,750 properties have a liability to VHT, amounting to €2.2 million.

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