Bernard Durkan (Kildare North, Fine Gael)
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167. To ask the Minister for Finance arising from recent demands for local property tax received by homeowners in recent times, if the current actual market value of a person's property remains as the guiding factor in the determination of actual liability; if any regard may be had for situations whereby a number of employed persons are residing in one dwelling alongside a similar dwelling occupied by a widow, widower, couple on pension; if any cognisance is taken of the ability of the latter to discharge the tax; and if he will make a statement on the matter. [18288/13]

Michael Noonan (Limerick City, Fine Gael)
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The Finance (Local Property Tax) Act 2012 (as amended) sets out how a residential property is to be valued for Local Property Tax (LPT) purposes. The LPT is a self-assessed tax and it is incorrect to describe the general issue of LPT Returns and supporting documentation by Revenue as demands for LPT. In accordance with the legislation, it is a matter for the property owner to calculate the amount of LPT due based on his or her assessment of the market value of the property. The level of household income, or the number of residents in the household, has no bearing on the amount of LPT due.

The initial valuation of a property on 1 May 2013, assuming it is made in good faith, will be valid up to and including 2016 and will not be affected by any increase or decrease in property prices or other changes, during this period. A system of deferral arrangements for owner-occupiers is available, one of which is dependent on the level of the owner's annual income. Where a property owner qualifies for deferral, interest will be charged on LPT amounts deferred at a rate of 4% per annum and the deferred amount, including the interest, will attach to the property and will have to be paid before the property is sold or transferred. Details of all the deferral options are available in Revenue's Guide to Local Property Tax which was issued to property owners and to Oireachtas Members and is also on Revenue's website www.revenue.ie.

I am informed by the Revenue Commissioners that as part of the general issue of Returns and booklets, which has been ongoing since last month and is almost concluded, property owners also received a Revenue Estimate of LPT. Revenue has made it clear that the Revenue Estimate is not based on a valuation of each owner's individual property nor should it be regarded as an accurate calculation of the amount of LPT that the owner should pay. The Estimate is only relevant where an owner does not make his or her self-assessment of the market value and complete and file his or her LPT Return.

To qualify for a deferral, the residential property must be occupied as a sole or main residence. The gross income thresholds for a full deferral will be €15,000 for a single person and €25,000 for a couple, whether married persons, civil partners or cohabitants. A person may claim a deferral if their gross income will not “as can reasonably be foreseen at the liability date” exceed these thresholds in that year. An increased gross income threshold applies in the case of properties occupied as a sole or main residence and subject to a mortgage. In such cases, the gross income thresholds may be increased by 80% of the mortgage interest payments. A deferral option in qualifying cases in this regard will apply until the end of 2017 and will assist individuals currently in mortgage distress.

A deferral of up to 50% of the LPT liability will be possible where the gross income of the liable person does not exceed €25,000 for a single person or €35,000 for married persons/civil partners/cohabitants. A deferral of 50% of the LPT will also be available where gross income does not exceed the above thresholds (€25,000 single, €35,000 couple) as increased by 80% of the gross mortgage interest payments that a liable person expects to make by the end of the year for which the gross income is being estimated. This type of deferral will also be available until 31 December 2017.