Challenging the amount of the new property tax assessment on your home.

geror

I understand the new tax will be based on very broad area boundaries.

For example, in which county you live and also for certain counties, i.e. those with cities, whether you live in the city or outside of it.

I've heard that revenue will be posting to each household, the amount due, but it will be possible to challenge their assessment.

Does anyone know what will be the basis for a successful challenge?

D3PO

geror wrote: »

I understand the new tax will be based on very broad area boundaries.

For example, in which county you live and also for certain counties, i.e. those with cities, whether you live in the city or outside of it.

I've heard that revenue will be posting to each household, the amount due, but it will be possible to challenge their assessment.

Does anyone know what will be the basis for a successful challenge?

there is NO challenge, its a self assesed tax. The letter will advise what the revenue believes the property is worth. If you disagree you pay according to your evaluation.

If they decide to audit you they can make you explain where your valuation came from. How that will work we wont know until it happens.

The_Morrigan

D3PO wrote: »

there is NO challenge, its a self assesed tax. The letter will advise what the revenue believes the property is worth. If you disagree you pay according to your evaluation.

If they decide to audit you they can make you explain where your valuation came from. How that will work we wont know until it happens.

I can see this going the same way houses were valued for mortgages years ago by the banks independent valuers....'How much of a mortgage do you need? .....ok the value is 120% of that figure'

Only now it will be in reverse!

geror

D3PO wrote: »

there is NO challenge, its a self assesed tax. The letter will advise what the revenue believes the property is worth. If you disagree you pay according to your evaluation.

If they decide to audit you they can make you explain where your valuation came from. How that will work we wont know until it happens.

Thanks D3PO, didn't realise it's actually self assessed... so if you can prove, based on recent sales that your house is lower than their assessment you'll be in a strong position if they audit!

D3PO

geror wrote: »

Thanks D3PO, didn't realise it's actually self assessed... so if you can prove, based on recent sales that your house is lower than their assessment you'll be in a strong position if they audit!

this is exactly how I will be approaching it. I fully expect they will overvalue and I will be paying according to the latest sale achieved in my estate from the property register. If they question it I will point this out to them and to me its unarguable.

Clearly if the sale was suspiciously low i.e potential executor sale I wouldnt use that but Im pretty sure most people will take this approach TBH.

TwoShedsJackson

Aren't they dividing it into bands though, and assessing the tax on the mid-point of that band? To avoid a rash of 'my house is worth €149,999' etc.

D3PO

TwoShedsJackson wrote: »

Aren't they dividing it into bands though, and assessing the tax on the mid-point of that band? To avoid a rash of 'my house is worth €149,999' etc.

yes they are. unlikely i will just be over a band but just in case I am thats how I am going to aproach it

Ritchi

TwoShedsJackson wrote: »

Aren't they dividing it into bands though, and assessing the tax on the mid-point of that band? To avoid a rash of 'my house is worth €149,999' etc.

It means if you say that you're worth 149k, then you pay it as if you were 125k, and if you are worth 150k, you pay it as if you are worth 175k. I think it will encourage people trying to get into the right band, rather than the opposite.

geror

Ritchi wrote: »

It means if you say that you're worth 149k, then you pay it as if you were 125k, and if you are worth 150k, you pay it as if you are worth 175k. I think it will encourage people trying to get into the right band, rather than the opposite.

If you're in the top half of the band you're less likely to object but there's certainly good grounds for objection if you're in the bottom half.

ted1

Stock can only be valued at the lower of cost or net reliasbale Value.

so its farily simple, just value it at what the last house in the area sold for and then allow for some fall.

Teh valu sof my house has iincreased since i bought it, so I'll be basign mine at the price I paid.

bbam

D3PO wrote: »

this is exactly how I will be approaching it. I fully expect they will overvalue and I will be paying according to the latest sale achieved in my estate from the property register. If they question it I will point this out to them and to me its unarguable.

Clearly if the sale was suspiciously low i.e potential executor sale I wouldnt use that but Im pretty sure most people will take this approach TBH.

Interestingly.
They have referenced checking the self assessments in a street of estate. If others accept a higher valuation if expect that will weaken any point you have to make on your behalf.
In a small estate it would probably be wise for a residents meeting to agree a valuation range and everyone submitts within the range.

Tow

The problem with undervaluing occurs when it, or a similar house it sold.
For example when we had the last property tax, a house near my parents was bought for £180k, the owner paid tax based on the £180K + house price inflation for 3/4 years until he sold it. It sold (at auction) for just over 400k and a few weeks later a letter arrived from Revenue charged him with back tax + interest + penalties for over £10k. He managed to argue then down to about 3K.

Revenue will be in no rush to chase people who under value, but at some point they will catch up with them, and have you seen their interest rate!

StillWaters

Tow wrote: »

The problem with undervaluing occurs when it, or a similar house it sold.
For example when we had the last property tax, a house near my parents was bought for £180k, the owner paid tax based on the £180K + house price inflation for 3/4 years until he sold it. It sold (at auction) for just over 400k and a few weeks later a letter arrived from Revenue charged him with back tax + interest + penalties for over £10k. He managed to argue then down to about 3K.

Revenue will be in no rush to chase people who under value, but at some point they will catch up with them, and have you seen their interest rate!

I suspect you are correct. This is Revenue we are talking about. Any attempt to pull wool over their eyes will not be tolerated. But I do wonder what will happen if house price rises in those first fixed years, and one sells, are you chased for the balance?

murphaph

StillWaters wrote: »

I suspect you are correct. This is Revenue we are talking about. Any attempt to pull wool over their eyes will not be tolerated. But I do wonder what will happen if house price rises in those first fixed years, and one sells, are you chased for the balance?

According to Noonan's budget speech you won't be. The value you declare doesn't have to take into account future unknown circumstances.

The whole way they are going about this is farcical. A "self assessed property tax" seems entirely ludicrous to me and I have to admit, I've never heard of one anywhere else.

They will be forced to revisit this and implement it properly later. Mark my words. They should be assigning land values according to postcode and square footage of the accommodation thereupon. If I installed solid 24 carat gold radiators in my 3 bed semi in D15 it would be worth several million Euro overnight but should I pay more property tax than the guy next door because I was foolish enough to install gold radiators and not invest in gold in a more indirect fashion? (extreme example but the principle holds for any home improvements that theoretically add value)

You can't value properties individually like this for an ongoing tax (it's fine when there's a transaction involved as you have a fixed value to work off), they have to use a more general formula based on (as yet non-existent post codes) that takes into account land value.

Victor

TwoShedsJackson wrote: »

Aren't they dividing it into bands though, and assessing the tax on the mid-point of that band? To avoid a rash of 'my house is worth €149,999' etc.

What they've done isn't particularly useful in that regard - people will simply try to skip into the next lower band (or lower one again).

ted1 wrote: »

Stock can only be valued at the lower of cost or net reliasbale Value.

That is only one way of valuing stock. Would you insure your stock of antiques at the lower price? Would you value you shares portfolio so?

D3PO

Tow wrote: »

The problem with undervaluing occurs when it, or a similar house it sold.
For example when we had the last property tax, a house near my parents was bought for £180k, the owner paid tax based on the £180K + house price inflation for 3/4 years until he sold it. It sold (at auction) for just over 400k and a few weeks later a letter arrived from Revenue charged him with back tax + interest + penalties for over £10k. He managed to argue then down to about 3K.

Revenue will be in no rush to chase people who under value, but at some point they will catch up with them, and have you seen their interest rate!

firslty knowbody is taking about people undervaluing. The example you have given is completely different. He took a price 4 years earlier and put an arbitary value on his based on that plus inflation which is retarded to be fair.

People are talking about taking a recent house sale using the property register to gauge a value. Anybody taking a value thats more than two quarters outdated and using it is an idiot.

Victor

D3PO wrote: »

Anybody taking a value thats more than two quarters outdated and using it is an idiot.

Play nice

Moderator

geror

Tow wrote: »

The problem with undervaluing occurs when it, or a similar house it sold.
For example when we had the last property tax, a house near my parents was bought for £180k, the owner paid tax based on the £180K + house price inflation for 3/4 years until he sold it. It sold (at auction) for just over 400k and a few weeks later a letter arrived from Revenue charged him with back tax + interest + penalties for over £10k. He managed to argue then down to about 3K.

Revenue will be in no rush to chase people who under value, but at some point they will catch up with them, and have you seen their interest rate!

Certainly worth keeping in mind and checking the assessment notes but my approach will be similar to D3PO although I'll get the sales in the estate since 2010, extrapolate the average to this year and use that as my valuation. I'll adjust this every year for the sales in that year and probably do a similar exercise for the larger area for comparison/adjustment/balance and availability of more data.

I know, at bit laborious - the property register is quite basic and only filters down to county - but it should guard against failing an audit!

bojim

geror wrote: »

I know, at bit laborious -

Does sound a bit laborious, if it helps your discussion I recently came across a free app on Google Play
https://play.google.com/store/apps/details?id=com.venitech.property.price.map&feature=search_result#?t=W251bGwsMSwxLDEsImNvbS52ZW5pdGVjaC5wcm9wZXJ0eS5wcmljZS5tYXAiXQ..
This helps to sort out property sales in Ireland by area. Saves looking up all this info by yourself.

geror

bojim wrote: »

Does sound a bit laborious, if it helps your discussion I recently came across a free app on Google Play
https://play.google.com/store/apps/details?id=com.venitech.property.price.map&feature=search_result#?t=W251bGwsMSwxLDEsImNvbS52ZW5pdGVjaC5wcm9wZXJ0eS5wcmljZS5tYXAiXQ..
This helps to sort out property sales in Ireland by area. Saves looking up all this info by yourself.

Thanks bojim, that Property Price Map is brilliant - I checked the data against my own calculations and got the same results - just wish I discovered it before going to all that effort!

StillWaters

geror wrote: »

Thanks bojim, that Property Price Map is brilliant - I checked the data against my own calculations and got the same results - just wish I discovered it before going to all that effort!

Is it just 2012 sales on it? its great though in any case.

The_Conductor

Tow wrote: »

Revenue will be in no rush to chase people who under value, but at some point they will catch up with them, and have you seen their interest rate!

Calculated on a daily basis, and compounded @ 0.0274% per day- which translates as a 10% annual rate (which is the same as the fiduciary rate).

geror

StillWaters wrote: »

Is it just 2012 sales on it? its great though in any case.

The map shows 2012 sales but check the Search menu - you can put in an address and it shows yearly summaries, no of houses sold, min, max & average price. Tap one of those summaries and the actual sales are listed - good for snooping on what the neighbours paid