Ireland Cracks Down on Property Tax Evaders

February 20, 2014 Taxation in Ireland

DUBLIN – Property owners in Ireland may face immediate penalties and increased scrutiny, as tax authorities prepare to drastically change their attitude to against tax avoidance on the real estate market.

The Office of the Revenue Commissioners of Ireland will soon contact more than half a million homeowners across the country with requests to meet missed tax obligations, and it will also launch new internal protocols to help determine which taxpayers are purposely undervaluing their properties in order to minimize their tax liabilities, according to a statement made by Finance Minister Michael Noonan on February 18th.

Later on the same day, the Office of the Revenue Commissioners issued an official statement confirming that, based on current compliance rates, from March 31st 2014 onwards approximately 100 000 homeowners will be contacted in regards to property taxes that they have not paid for the 2013 year, and an additional 460 000 individuals will be contacted in regards to household charges not yet paid for the 2012 year.

Starting from now, the Office will also check each return to ensure that the payment amount and declared property value are in line with neighboring taxpayers, in order to uncover any instances of homeowners purposely and unrealistically understating the value of their property to unfairly minimize their tax liability.

The collated data about property prices will also be used to ascertain whether any adjustment should be made to the method of calculating property taxes and household charges in Ireland.

In its statement, the Office clearly indicated that any payments outstanding on April 1st will immediately face a penalty interest rate of 0.0219 percent per day, and the tax authority will not tolerate any further avoidance by property owners.

Photo by: Elliott Brown