PART 22B

VACANT HOMES TAX

Overview

This Part provides for a charge to vacant homes tax (VHT) to be applied in respect of residential properties that are occupied as a dwelling for less than 30 days in a chargeable period. Each chargeable period commences on 1 November and ends on 31 October of the following year. The first chargeable period commenced on 1 November 2022 and ended on 31 October 2023.

VHT is charged at a rate that is a multiple of the basic rate of Local Property Tax (LPT) applying to the residential property for the year in which the chargeable period ends. For the first chargeable period VHT was charged at a rate of 3 times the basic rate of LPT applying to the residential property. For the second chargeable period, 1 November 2023 to 31 October 2024, VHT was charged at a rate of 5 times the basic rate of LPT applying to the residential property. For the third chargeable period, 1 November 2024 to 31 October 2025, and all future chargeable periods, VHT is charged at a rate of 7 times the basic rate of LPT applying to the residential property.

The legislation provides that certain properties will not fall within the scope of the tax. The legislation also provides for exemptions from the charge to VHT for properties that are vacant as a result of genuine and acceptable reasons.

The person who is obliged to file a VHT return and pay VHT for a chargeable period is the chargeable person. This is the person who is the liable person for LPT purposes on the day immediately following the end of the chargeable period (i.e. on 1 November 2023 for the first chargeable period). Generally, the chargeable person will be the owner of the property.

The due date for filing VHT returns is 7 November after the end of the chargeable period and the due date for paying VHT is the following 1 January.

The tax is operated on a self-assessed basis, which means that the chargeable person is required to determine whether or not they have a liability to VHT and satisfy their pay and file obligations, if any.

Revenue may require any chargeable person to file a VHT return for a chargeable period, notwithstanding that the person may not have a liability to VHT for that period.

Chapter 1

Interpretation

653AN Interpretation (Part 22B)

Summary

This section sets out the definitions to be used for the purposes of Part 22B.

Details

(1) Definitions

“Act of 2003” means the Capital Acquisitions Tax Consolidation Act 2003.

“Act of 2004” means the Residential Tenancies Act 2004.

“Act of 2012” means the Finance (Local Property Tax) Act 2012.

“chargeable period” means the 12-month period commencing on 1 November of each year, commencing with the year 2022.

“chargeable person” in relation to a residential property, means the person that is the liable person in relation to the residential property for the purposes of the Finance (Local Property Tax) Act 2012 on the relevant date.

“chartered engineer” has the same meaning as it has in section 7 of the Institution of Civil Engineers of Ireland (Charter Amendment) Act, 1969. It means a person who is registered as a chartered engineer with the Institution of Engineers of Ireland operating as Engineers Ireland.

“company” has the same meaning as it has in the Finance (Local Property Tax) Act 2012. Its meaning includes any body corporate.

“designated chargeable person” is to be construed in accordance with section 653AS. The person who is the ‘designated liable person’ in respect of a residential property for the purposes of local property tax on the relevant date is also the ‘designated chargeable person’ for the purposes of vacant homes tax on that date. In general, it is the person who is nominated by all the persons who jointly own a property (and are therefore chargeable persons in respect of that property) to comply with the obligations imposed by this Part. If there is more than one chargeable person in respect of a property and if a nomination has not been made by the chargeable persons, the Revenue Commissioners may designate a person to be the designated chargeable person. All persons who are chargeable persons in respect of a property remain jointly and severally liable for the payment of the liability to vacant homes tax even where one chargeable person is the designated chargeable person in respect of that property.

“electronic means” has the meaning assigned to it by section 917EA. In section 917EA, ‘electronic means’ includes electrical, digital, magnetic, optical, electromagnetic, biometric, photonic means of transmission of data and other forms of related technology by means of which data is transmitted.

“liability date” has the same meaning as it has in the Finance (Local Property Tax) Act 2012, i.e. it means 1 November in the preceding year. For the purposes of VHT this is the day the chargeable period commences.

“liable person” has the same meaning as it has in the Finance (Local Property Tax) Act 2012. The definition refers to a person who is entitled to immediate possession of a property, or entitled to receive the rents or profits, for a term that may equal or exceed 20 years. In general, the liable person in respect of a property is the person who owns the property.

“local authority” means a county council, a city council or a town council within the meaning of the Local Government Act 2001.

“local property tax” has the same meaning as it has in the Finance (Local Property Tax) Act 2012.

“market rent” has the same meaning as it has in the Residential Tenancies Act 2004. In general, it means the rent which a willing tenant not already in occupation of a residential property would give and a willing landlord would take by reference to the terms of the tenancy and on the basis of vacant possession being given.

“market value” in relation to a residential property, means the price which that residential property might reasonably be expected to fetch on a sale in the open market.

“personal public service number” has the same meaning as it has in section 262 of the Social Welfare Consolidation Act 2005.

“register” has the meaning given to it by section 653BL. It means a register of vacant homes and associated chargeable persons which is to be established and maintained by Revenue.

“registered medical practitioner” means a medical practitioner who is registered in the register established under section 43 of the Medical Practitioners Act 2007.

“registered professional” has the same meaning as it has in the Building Control Act 2007. It means a person who is registered as an architect on the register established and maintained by the Royal Institute of Architects of Ireland, a person who is registered as a quantity surveyor on the register established and maintained by the Society of Chartered Surveyors or a person who is registered as a building surveyor on the register established and maintained by the Society of Chartered Surveyors.

“relevant date” in relation to a chargeable period, means the first day immediately following the end of the chargeable period. As the last day of a chargeable period will always be 31 October, a relevant date will always be 1 November.

“relevant person” has the same meaning as it has in the Finance (Local Property Tax) Act 2012. The Finance (Local Property Tax) Act 2012 lists at section 153 all persons who are relevant persons for the purpose of Part 15 of that Act. A relevant person is a person from whom Revenue can request information.

“relevant tenancy” means a tenancy between a landlord and a tenant who are not connected with each other within the meaning of section 10, where the rent reserved is market rent and where the tenancy has been registered in accordance with Part 7 of the Residential Tenancies Act 2004. Part 7 requires a landlord to register a tenancy on a register that is maintained by the Residential Tenancies Board within a period of one month of the tenancy commencing and again within one month of the anniversary of the date that the tenancy commenced.

“residential property” has the same meaning as it has in the Finance (Local Property Tax) Act 2012. In general, it means any part of a building, structure or erection that is used, or suitable for use as, a dwelling. It includes any shed, outhouse, garage, or other building together with any garden or grounds (not exceeding 0.4047 hectares) which are usually enjoyed with the residential property.

“return” means a return in respect of vacant homes tax which is required to be prepared and delivered to Revenue under section 653AQ.

“return date”, in relation to a chargeable period, means 7 November immediately following the end of the chargeable period.

“sale” is defined to include all transfers of a residential property. Therefore, it includes a sale of a property as a result of a compulsory purchase order, and a situation where the ownership of a residential property changes without one person having paid the other, in full or in part, to acquire an interest in the property.

“self-assessment” means an assessment made by or on behalf of a chargeable person of the amount of vacant homes tax payable by the chargeable person in respect of a residential property for a chargeable period.

“taxable inheritance” has the same meaning as it has in the Capital Acquisitions Tax Consolidation Act 2003. Section 10 of that Act sets out when an inheritance is deemed to be taken. In general, a person takes an inheritance when they take a benefit on the death of a person. Section 11 defines a taxable inheritance and places a territorial limit on inheritances that are subject to Capital Acquisitions Tax in Ireland.

“vacant home” means a residential property in respect of which a charge to vacant homes tax arises under section 653AO.

“vacant homes tax” has the meaning assigned to it by section 653AO.

“valuation date” is defined in section 30 of the Capital Acquisitions Tax Consolidation Act 2003. In the case of an asset that is the subject of an inheritance, it means the date that the person administering the estate of a deceased person can retain the asset, the date the person administering the estate actually retains the asset or the date that the asset is given to the person who is inheriting it, whichever date arises first.

“valuation period” has the same meaning as it has in the Finance (Local Property Tax) Act 2012. So, for example, the valuation date for the years 2022 to 2025 was 1 November 2021. The valuation period is the period from 2022 to 2025 inclusive.

Relevant Date: Finance Act 2024