- Under the Finance (Local Property Tax) Act 2012, Local Property Tax (“LPT”) is payable by the owner(s) of all residential properties in Ireland. This is an annual payment which is due from 1 November each year. If your property is liable for LPT in 2026, the payment will be payable from 1 November 2025.
- The amount of LPT payable varies from one property to another. The property is placed in a valuation band which determines the amount of LPT payable. For example, if a property owner submitted a valuation of their property at €340,000 on or shortly after 1 November 2021 (the last valuation date), the property will have been placed in LPT band 3 (€262,501 – 350,000) which would result in an annual LPT charge of €315. Each Local Authority may currently adjust the figure upwards or downwards by 15%. This is known as the local adjustment factor.
- Properties are scheduled to be revalued on 1 November 2025 which will determine the valuation band for the property for the next five years. Form 2026 onwards, the local adjustment factor will allow Local Authorities to vary LPT upwards by up to 25% and downwards by 15%.
- Given that housing prices have risen sharply in recent years, it is common for the sale price of a property to be considerably higher than the valuation provided at the last valuation date (e.g. 1 November 2021). For example, if the sale price is greater than 125% of the upper limit of the current band, then it will be necessary to apply to Revenue for LPT specific clearance (“Specific Clearance”). This is certification from Revenue that the property was accurately valued on 1 November 2021 and is often required to be provided to the purchaser to satisfy them that the vendor has not been underpaying LPT on the property during their period of ownership.
- The application for Specific Clearance requires the submission of a completed Form LPT5 to Revenue wherein details of comparator properties are provided, details of which can be found on the Property Price Register which is available online. If it is proving difficult to find comparators, the estate agent acting in the sale may provide a valuation of the property as at 1 November 2021 (Form 2026 onwards this relevant valuation date will be 1 November 2025 as outlined above). Note Specific Clearance is not required if the sale prices is below €500,000 in Dublin or €400,000 outside of Dublin.
- Note that where LPT is paid outside of the required payment period for any given year, interest will accrue and will become added to the account once the liability is satisfied. As such, it is imperative that this payment is made on time to avoid any unnecessary future costs. It is possible to set up a direct debit with Revenue wherein the LPT payment comes out of your account in monthly installments.
LPT must be paid up to date in order to proceed with the sale of a property. When you are in the process of selling, your solicitor will ask you to provide the LPT printout for the property which is a statement from Revenue, accessible through Revenue Online, which states the valuation band of the property, the amount due for each year and whether there is any outstanding balance due. Once your solicitor reviews your LPT printout, they will be able to confirm whether it will be necessary to apply for Specific Clearance from Revenue.
if you have any further queries in relation to this article please do not hesitate to contact Adam Rockett, Pauline Horkan or Sally-Ann McCoy on 01 296 0666
