Hogan highlights NPPR penalty grace-period
Hogan highlights NPPR penalty grace-period
The Minister for the Environment, Community and Local Government, Mr. Phil Hogan, T.D., today (5 March, 2014) encouraged any non-compliant property owners to take advantage of the period from now until 31st August 2014 to regularise their payment of any outstanding Non-Principal Private Residence (NPPR) liabilities. The NPPR charge, which has since been discontinued, applied in the years 2009 to 2013 to any residential property in which the owner did not reside as their normal place of residence.
Mr Hogan acknowledged that compliance with the charge has been high with approximately 360,000 properties registered and over €400m raised, all of which has been used to fund local authorities in delivering vital services. The €200 annual charge has fallen, in the main, on owners of rental, holiday and vacant properties including those properties where the owners lived abroad. “While I am pleased with the collection rates to date, I am anxious to ensure local authorities continue to engage with non-compliant owners to ensure that all outstanding liabilities are cleared as soon as possible,” he added.
Mr. Hogan advised that anyone who has not registered with their local authority and remains liable to the charge has already accrued significant late payment fees on their property for the relevant years. Apart from the initial charge of €200 per liable property each year, additional late payment fees have been accruing at the rate of €20 per month in the intervening period. The Minister wished to draw attention to the new measures contained in the Local Government Reform Act 2014, dealing with the collection of undischarged liabilities relating to the NPPR charge. The Act provides for a period, commencing on 2nd March 2014 to 31st August 2014, during which time no new late penalties will be applied to existing liabilities. If payment is not made in full, or, if settlement terms are not agreed by the end of that period, an additional late payment fee of €120 per liability date is applied on 1st September 2014. In addition, the entire NPPR liability is increased by a factor of 50% and frozen. For example, the aggregate liability and late payment fees in respect of a property which has been liable for the NPPR charge for 5 years from 2009 to 2013, would increase from €4,220 up to €7,230 on 1 September 2014 on the expiry of the grace period.
Mr Hogan reiterated that it is very much in the interest of non-compliant owners to come forward to regularise their affairs and to take advantage of this once-off opportunity. The NPPR charge is based on self-declaration and therefore the onus is on the property owner themselves to register their property and make the payment. “It is important to note that payment of outstanding charges and late payment fees must be made prior to the sale or transfer of a property”, he added. “Local authorities will be taking a proactive approach to ensure that any outstanding liabilities are discharged in the most equitable, efficient and economically beneficial manner”
Minister Hogan advised non-compliant owners to log on to www.nppr.ie , or alternatively to contact their local authority and make their outstanding payments before 1 September 2014 to avoid incurring additional fees.
Notes for editors
Non-Principal Private Residence Charge
The Local Government (Charges) Act 2009, as amended by the Local Government (Household Charge) Act 2011, introduced a €200 annual charge on non-principal private residences (NPPR), payable by the owners to the local authority in whose area the property concerned is located.
The NPPR charge was effective for the years 2009 to 2013 only. Part 12 of the Local Government Reform Act 2014 provides for the repeal of the legislation governing the NPPR charge and deals with the collection of undischarged liabilities relating to the NPPR charge.
The NPPR charge is separate from both the Household Charge (€100 for 2012 only) and Local Property Tax (valuation based, from 2013 onwards) which are the responsibility of the Revenue Commissioners.
2 March 2014 to 31 August 2014 - period to pay NPPR charge without additional late fees.
In order to maximise compliance and encourage payment of outstanding NPPR charge arrears, section 74 of the Local Government Reform Act 2014 provides for a period, commencing on 2nd March 2014 to 31st August 2014, during which time no new late payment penalties will be applied to existing liabilities.
Property owners have a final opportunity to bring their NPPR Charge affairs up to date in this period. If payment is not made in full, or, if settlement terms are not agreed by the end of that period an additional late payment fee of €120 for each year the charge was not paid is applied on 1st September 2014. In addition, the entire NPPR liability is increased by a factor of 50% and frozen.
Who has to pay the NPPR Charge?
Liability for it falls, in the main, on owners of rental, holiday and vacant properties.
While the charge is commonly referred to as a “second home charge”, it is, in fact, a charge on a property not used by the owner as his or her sole or main residence. This may not necessarily be a second home. A person might have vacated a property and be living in rented accommodation elsewhere for work or other reasons. In such a case, the property that the owner is no longer living in is liable for the charge, even if it is the only residential property that person owns.
Liability to pay the charge is determined on the basis of ownership of the property in question on a single day each year. This date, which is called the "liability date", is 31st July for 2009 and is 31st March in 2010 and subsequent years. The charge must be paid within three months of the liability date (31st October in 2009 and 30th June for 2010 and subsequent years) in order to avoid late payment fees.
What Should You Do?
• If you are the owner of a residential property and are liable for the NPPR charge and you did not pay it, you should contact the relevant local authority and either make payment in full or come to an agreed payment plan within the period (2nd March to 31st August) to avoid additional late payment fees.
• Please contact the Finance department in the Local Authority associated with the NPPR (Non Principal Private Residence) or log on to www.nppr.ie to pay the charge or if you have any queries regarding the potential liability of your property.