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Six things you need to know about paying your property tax for 2016

Homeowners who can’t afford to pay their property tax as a once-off lump sum anymore have three days to the tell the Tax Man that they want to pay it another way.

November 25 is the deadline for confirming to the Revenue Commissioners how you wish to pay your property tax – if this is your first time to spread your payment of the tax over the year (known as the phased payment option).

“If you’re in a situation where you have paid the property tax as a lump sum before, and you want to spread the payments over 2016 instead, now is the time to let Revenue know,” said Brian Keegan, director of taxation with Chartered Accountants Ireland.

You have three ways to spread your payments out – by direct debit, deduction at source (where the tax is taken out of your wages, occupational pension or certain social welfare payments) or through regular cash payments (where you pay your tax through An Post, Payzone or your credit union).

Those who have already taken up the phased payment option in previous years, and who wish to continue doing so, don’t have to do anything as their payment methods will automatically roll over into 2016.

Here are five other things you need to know about this year’s property tax

Pay by January 7 if using your card

You have until 5pm on January 7, 2016 to pay your property tax if paying it once-off and in full by cash, cheque, postal order, credit card or debit card.

Should you want to pay through a one-time withdrawal from your bank account (known as a single debit authority), you have until January 7 to agree to this. You have a bit more time – until March 21, 2016 – to pay the tax in this way.

You don’t need to revalue your home

When the property tax was first introduced, it was expected that homeowners would need to revalue their properties (for the purpose of the tax) in November 2016.

So although you wouldn’t have had to revalue your home this year for the property tax due in 2016, you certainly would have had to start thinking about it.

However, under Budget 2016, Finance Minister Michael Noonan postponed the revaluation date for the tax from late 2016 until 2019. This means you won’t have to revalue your home until 2019 – if you have to at all. As the previous valuation date for the property tax was May 2013 and many property prices across the country have risen since then, many homeowners would have faced a much higher property tax bill for 2017 – if the original revaluation date still stood.

Your property bill could still be higher

Many homeowners saw their property tax bills fall this time last year when 14 local councils voted to reduce the rate. Some homeowners, including those in Wicklow, Clare, and South Dublin, saw their property tax bills for 2015 fall by 15pc as a result.

However, this year, five local authorities have increased the 2016 rate compared to last year: Cork County Council, Limerick City Council, Mayo County Council, Westmeath County Council and Wicklow County Council.

Those in Wicklow will be hardest hit because members of the local authority there have decided to row back on the 15pc reduction which applied for 2015. This means homeowners in Wicklow can expect a 15pc hike in their property tax bill this year. So a Wicklow homeowner with a property worth €550,000 will see their tax bill jump from €803 to €930 this year.

Monaghan has reduced its rate for this year and a number of local councils (including South Dublin, Clare, Longford and Louth) are staying at the lower rate agreed last year.

You shouldn’t have to pay more tax if selling your home – even if it is more valuable

“Many people who are selling properties today are concerned that they may have an additional tax liability – as the price they’re getting for their home is quite a bit higher than what it was valued at for local property tax purposes in 2013,” said Mr Keegan.

“However, at the end of the day it doesn’t matter by how much the property has increased in value since 2013 – as long as the 2013 valuation was accurate and fair, you won’t have to pay a higher property tax.”

You’re not entitled to a refund if you sell your home

You’re not entitled to a refund of the tax if you sell your home before the end of the year – or early next year.

“If you own the property on November 1, 2015, you are liable for the 2016 property tax,” said Mr Keegan. “It doesn’t matter who owns the property in 2016.

“If you sell next year, you may come to an arrangement with the purchaser to give you a few bob back – but there’s no entitlement to a refund as such.”

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