The Local Government (Charges) Act 2009 (the “Act”) provides for the payment of an annual charge (commonly referred to as the “Non-Principal Private Residence Charge” or “NPPR Charge”) to Local Authorities in respect of residential property. The NPPR Charge applies mainly to owners of private rental property and holiday homes but it also applies to vacant residential property unless that property is newly built but unsold.
As the 30 September 2009 payment date for the NPPR Charge approaches, it is worth reviewing the legislation to ensure that everyone liable to pay the charge is aware of their responsibility to do so.
THE NPPR CHARGE
The Act introduced a €200.00 annual charge on every person who is the “owner” of a residential property on the “liability date”. In the case of co-owners, they are jointly and severally liable and payment by either one of them will discharge the liability of each of them.
Whilst the Act does not use the term "non principal private residence", it exempts from the NPPR Charge any property which is the "sole or main residence" of the owner.
An “owner” is defined in the Act as any person who, in their own right or as a trustee or agent, is the person entitled to receive the rent of the property or, where the property is not let, would be so entitled if it were so let.
NEWLY CONSTRUCTED BUT UNSOLD RESIDENTIAL PROPERTY
The definition of “residential property” in Section 2(b) of the Act specifically excludes:
A building that forms part of the trading stock of a business
- from which, since its construction, no income has been derived, and
- which has not, at any time since its construction, been used as a dwelling.
This section excludes newly constructed dwellings that form part of the trading stock of a business from which no income has been derived and which have not been used as a dwelling. Trading stock of a business would include property constructed with an intention to sell and which is held by the company pending such sale. If newly constructed property does not comply strictly with this exclusion, it will be liable to the NPPR Charge. Accordingly, any residential unit which has been let, even on a temporary basis pending a sale, is liable for the NPPR Charge.
Dates and penalties Liability for the NPPR Charge shall arise for the owners of qualifying residential property on a set date in each year known as the “liability date”.
For 2009, the liability date is 31 July 2009. An owner of qualifying residential property on this date will be liable to pay the NPPR Charge by 30 September 2009.
From 2010 onwards, the liability date shall be 31 March of each year and an owner will be liable to pay the NPPR Charge by 31 May each year.
The Act provides for a grace period of one month for late payment so that if payment is not received by 31 October 2009 or, from 2010 onwards, by 30 June of that year, a €20.00 late payment fee will apply in respect of each month or part of a month during which the charge remains unpaid. It is worth noting that an NPPR Charge of €200.00 unpaid for each of five years for an individual property will amount to €4,500.00 when including the penalties of €3,500.00.
The unpaid fee remains a charge on the property itself and a person who fails to pay the NPPR Charge will be guilty of an offence under the Act.
Click here to view table
Payment of the NPPR Charge should be made on-line at www.nppr.ie or presented in person or by post to your local Public Service Centre by bank draft, postal order or cheque payable to “LGCSB NPPR”. Payments made out to a local authority will be returned. Cash payments cannot be accepted.
Finally, when the NPPR Charge is being paid, each chargeable property must be registered by completing an NPPR Registration form giving the following details:
- Contact details of the owner (private owner or corporate owner) including the PPS number of an individual owner or the tax reference number of a corporate owner.
- Details of the property to be registered.
This form may be completed on-line at www.nppr.ie. A letting agent may complete the form on behalf of the owner.