Fianna Fáil Spokesperson on Finance Michael McGrath TD has called on the Minister for Finance to change the rules governing the application of the property tax to persons with a disability who have had adaptation works carried out to their homes.
Deputy McGrath commented: “Both the initial Local Property Tax legislation and the subsequent amendment bill were rammed through the Oireachtas by the government with no serious debate on important aspects of the new property tax regime including the treatment of persons with a disability.
“In my view, the provisions in the property tax legislation pertaining to disabled persons are absolutely cruel, discriminatory and ridiculously complex. The government is trying to give the impression that it is giving an exemption to people with a disability but instead it has deliberately designed a scheme that will be of no practical use to the majority of people who have had their homes adapted.
“For example, the property tax exemption only applies to a ‘permanently and totally incapacitated person’ who has built or adapted their home and who has received an award from the Personal Injuries Assessment Board or a court, or where a trust has been established and the exemption will only apply where the cost of the adaptations exceeds 25% of the market value of the property before it is adapted. This exemption is extremely narrow and discriminates against a person who may have acquired a disability over the course of their life.
“The second relief is even more complicated and provides for ‘a reduction in the market value of a residential property that has been adapted for occupation by a disabled person where the adaptation has been grant aided by a local authority….the reduction in value is limited to the lesser of the chargeable value attributable to the adaptation work carried out on the property and the maximum grant payable under the relevant local authority scheme.’
“The truth is that many disabled people will not have received any local authority grant for the adaptation works and will not qualify. Even if a person did get a local authority grant, they will only benefit if the work actually increased the value of the house. People with a disability will confirm that the adaptation work carried out to their home often actually reduces the value of the property.
“Over the past number of weeks, I have been contacted by many individuals with a disability who hoped they might be exempt from the property tax. They have been left deeply disappointed when I go through the detailed rules with them. If the government is genuine about trying to make special provision for disabled persons in the new property tax regime, it will urgently revisit these ridiculous rules which give the impression something positive is being done when the reality is altogether different.”
Below is a Dáil reply from Minister Noonan explaining the property tax provisions for persons with a disability:
Minister for Finance (Deputy Michael Noonan): The Finance (Local Property Tax) Act 2012 (as amended) includes provisions that provide exemption or relief from Local Property Tax (LPT) for certain properties which have been adapted by disabled persons, depending on the circumstances involved. Section 10B of the 2012 Act (as inserted by the Finance (Local Property Tax) (Amendment) Act 2013) provides an exemption from LPT for a residential property purchased, built or adapted to make it suitable for occupation by a permanently and totally incapacitated individual as their sole or main residence, where an award has been made by the Personal Injuries Assessment Board or a court, or where a trust has been established, specifically for the benefit of such individuals. In the case of adaptations to a property, the exemption will only apply where the cost of the adaptations exceeds 25% of the market value of the property before it is adapted. The exemption ends if the property is sold and the incapacitated individual no longer occupies it as his or her sole or main residence.
Section 15A of the 2012 Act (as amended) provides for a reduction in the market value of a residential property that has been adapted for occupation by a disabled person where the adaptation has been grant-aided by a local authority. The person with the disability must occupy the property as his or her sole or main residence after the adaptation is completed. The reduction in value is limited to the lesser of the chargeable value attributable to the adaptation work carried out on the property and the maximum grant payable under the relevant local authority scheme.
The relief is dependent on local authority grant aid being paid under S.I. 607 of 2001 or S.I. 670 of 2007. The 2001 regulations cover adaptation work carried out on or after 1 March 1993 and on foot of applications received by a local authority up to 1 November 2007 at which stage S.I. 670 of 2007 came into effect. This relief ends on the sale or transfer of a property that has been adapted, unless the person with the disability continues to reside in the property.