Revenue valuation a concern for homeowners as new Property Tax looms

In a survey undertaken by personal tax experts, Kilkenny based www.taxback.com it was revealed that while the majority of respondents intend to comply with the new property tax requirements, many of them have concerns over suggestions in relation to the assessment of property values by the Revenue.

In a survey undertaken by personal tax experts, Kilkenny based www.taxback.com it was revealed that while the majority of respondents intend to comply with the new property tax requirements, many of them have concerns over suggestions in relation to the assessment of property values by the Revenue.

When asked about the method of payment the majority of respondents said that they would prefer to pay it by credit/ debit card (42%), while 21% would like to pay it perhaps incrementally by direct debit, with just 15% selecting the cash option.

According to Barry Flanagan, Tax Expert with www.taxback.com , “The respondents ranged from all ages, gender and backgrounds and from locations throughout the country– however as they are a sample of our customer database the one thing that they would all have in common is their penchant for tax compliance and/or having their tax affairs in order. 65% of those surveyed did not seem to have a problem with the suggestion that the money be taken from their salary or wages – there are approx. 33,800 households in Kilkenny so that would equate to approximately 21,900 of these households”.

Taxback.com said there were definite grumblings within the mix over the introduction of the new tax and in particular many people are concerned as to the valuation techniques suggested in the media of late.

However, Taxback.com representatives met with the Revenue last week and it is now known that the Revenue will be providing a guideline estimation only and that taxpayers will be expected to base their return on the most accurate information available, rather than relying on an that estimate if they believe it is incorrect.

Barry continued, “The true valuation may result in a higher or lower charge than the estimate suggested by Revenue; taxpayers should adjust accordingly”.

Some of the answers from the survey included… when asked about the potential methods for valuation being discussed in the media and any concerns they may have in this respect, or clients said …

- “That they(*Revenue) will value our property too high and therefore we will be charged a higher tax.”

- “None because I won’t be paying it.”

- “If they(*Revenue) undervalue my property this may affect my ability to sell it at a profit. However, if they overvalue my property it will affect selling price.”

- “The valuation will not take into account ability to pay.”

- “How does your house have a value if no one is prepared to buy it?”

The survey revealed that 59% of employers did not voice any concerns in relation to the implementation of the withholding of the tax from your employees. Of those that were in favour of this approach, most highlighted convenience as the reason why.

When asked “Would you allow your employer to deduct this from your salary as a method of paying your local property tax” some of the responses included;

- “Yeah why not? I have to pay it so better it never hits my pocket and never gets spent.”

- “If any more is taken from my wage packet in tax I will be working for free!”

- “Would not like to disclose my property details to my employer as this may have implications on my salary increases in the future.”

- “It’s a pretty safe method and a way to spread the payment so it’s basically an easy option. It has to be paid anyway so might as well do it with the PRSI and PAYE in one go.”

- “In fact I don’t intend on paying at all unless there is a full debate on what services are available for this new tax.”

- “I rather look after it myself so I know it’s correct.”

Flanagan concluded, “It looks, from this survey, like the implementation of the property tax will not be half the nightmare the collection of the Household Tax was – a wide range of payment options will be available and will be communicated directly to the taxpayers. However, it is clear that there is still a significant % of the Irish public who, whether they intend to pay it or not, believe that this tax is unfair and unjust. Although some employers are clearly unhappy in relation to the implementation of the withholding of the tax from their employees, Revenue has made it very clear that employers will not be given an option on whether or not to apply the deduction from an employee’s wages, and will be expected to comply with each such instruction received”.