In early June, changes were announced to local property tax (LPT) and the General Scheme of Finance (Local Property Tax) (Amendment) Bill 2021 was published. The main change to the LPT regime is that exempt properties built since the last LPT valuation date (in 2013) will now be brought within the LPT charge. Changes are also being made to cut the rate of LPT and widen the valuation bands.
Overall, it is expected that most homeowners will see no change or decrease in their LPT liability. Local authorities will also now retain 100% of the LPT collected in their area.
The next valuation date for LPT purposes is 1 November 2021, with property valuations to be reviewed every four years after that. This will facilitate the regular addition of new properties to the LPT regime. All new properties built between valuation dates will be retrospectively valued as if they existed on the preceding valuation date and become liable on the next 1 November liability date.
As LPT is a self-assessed tax, it will be subject to the usual Revenue compliance checks that apply for other self-assessed taxes.
It is expected that the bill will be enacted before the Dáil’s summer recess to enable Revenue to make the essential technical and administrative preparations to implement the changes before the 1 November valuation date.
Revenue’s new electronic employer’s share awards return (form ESA) 2020 went live in the third week of June
The deadline for employers to review, correct (if necessary) and accept their reconciliation balance of temporary wage subsidy scheme (TWSS) payments displayed on ROS was 30 June 2021. Revenue has updated its employer guidance for TWSS reconciliation to provide further information on the next stage of the process. This includes the following:
- TWSS statements of account will be issued to employers (and their agents) whether or not the employer accepted the result of the reconciliation on ROS. This statement will show any TWSS balance due to Revenue or refund due to the employer.
- TWSS notices of assessment will be issued from mid-July to employers who have an outstanding TWSS balance due to Revenue. This will confirm the final TWSS liability balance due.
- Debt warehousing of TWSS will be available to employers who are approved for the debt warehousing scheme. The TWSS balance due to Revenue will be added to the employer’s warehoused liability. If employers do not qualify for debt warehousing, they (and their TWSS-linked ROS agents) will be able to make TWSS payments via ROS. If employers have difficulty in paying this liability, they can apply to pay the debt in instalments.
- TWSS reconciliation-related ROS facilities will cease in mid-July. Employers will no longer be able to upload a subsidy-paid file but can continue to report any subsidy paid to employees through their payroll reporting package or direct on ROS. These subsidy-paid values will be applied to the employee’s tax record but will not result in any update to the employer’s TWSS statement of account. Access to the reconciliation information on ROS will also cease. Revenue has emphasised the importance of employers downloading and keeping a copy of their employer reconciliation detail CSV file for their own records before then.
Share schemes reporting
Revenue’s new electronic employer’s share awards return (form ESA) 2020 went live in the third week of June. This electronic form ESA will apply for the tax year 2020 onwards, with a filing deadline of 31 August 2021 for the 2020 return. For subsequent years, the reporting date of 31 March following the relevant tax year will apply.
Finance Act 2020 provided for the mandatory e-reporting of certain share-based remuneration, including restricted stock units, restricted shares, convertible shares, forfeitable shares, discounted shares, and any other award with cash equivalent of shares.
The new ESA return has a similar format to the existing returns in relation to share-based pay – ie the RSS1, ESS1 and KEEP1 electronic returns – and is a preformatted Excel spreadsheet that can be uploaded.
The share schemes manual has been updated to reflect the new reporting obligations, together with instructions and explanatory notes on completing the return.
The new electronic professional services withholding tax regime came into operation on 1 July 2021. The most important change to the PSWT process is the removal of paper F45s, which an accountable person (such as a government department or agency) must give to the providers of professional services as a record of tax deducted from payments made to them.
The F45 forms are being replaced with e-payment notifications on ROS. This change is expected to eliminate 500,000 paper forms from the tax administration system annually. Records of payments and tax deducted will now be available on ROS. More information on the new regime is available here.
Disclaimer: While every effort has been made to ensure the accuracy of this information, the Irish Tax Institute does not accept any responsibility for loss or damage occasioned by any person acting, or refraining from acting, as a result of this material.