Housing Measures

Zoned Land Tax

The new Zoned Land Tax, once implemented, will replace the current Vacant Site Levy. The key purpose of this tax is to stimulate activity in the housing market to encourage the development of existing zoned or serviced residential development land. It is not envisaged to be a long term revenue raising measure for the Exchequer, and the Department of Housing have outlined indicative estimates that the tax could impact on up to 9,000 hectares of land based on current zoning. This targeting, as a stimulus for an increase in housing supply as opposed to tax receipts, is reflective in the lead in times which have been provided for in terms of the implementation of the tax i.e.

  • For any chargeable land which has been zoned before 1 January 2022, the charge to the tax will apply annually from 1 January 2024 onwards
  • For any chargeable land which has been zoned after 1 January 2022, the charge to the tax will apply annually from the date which is 3 years after such date on which the land was zoned

The tax will be calculated at the rate of 3% of the market value of the land within the scope of the measure. It will be payable on an annual basis a return date of 23 May of each year. Cases of non-compliance will be subject to interest, penalties and surcharge of up to 30% in the case of undervaluation of the land.

There will be a number of exclusions from the charge to the tax including:

  1. In the case of zoned residential land, any existing dwellings on the land (and their curtilage), land used for social and recreational purposes, or such land used to provide services which are considered essential to a residential community (e.g. a local shop).
  2. In the case of zoned mixed use, any commercial businesses and farmland will be excluded, the only land within remit being that which is lying vacant or idle.

Local authorities are to be charged with publishing relevant maps to enable administration of the tax. There will be a process to allow for a right to appeal any dispute over inclusion in the maps, and also any landowners will be allowed to submit a request for a change in the zoning status for consideration by the relevant local authority. For land which is within scope of the tax, the tax will also be abated during such time after construction commences in respect of residential development on the land, with no further tax ultimately due once the development is completed in accordance with the relevant planning laws.

Help To Buy Scheme

The Help to Buy Scheme was previously enhanced and has been extended to continue in its enhanced format for a further year to 31 December 2022. This extension is to allow for a complete review of the scheme during 2022 with announcements with regard to the future/updates to the current scheme to be announced likely in time for delivery of Budget 2023.

The Help To Buy Scheme currently provides relief for first time buyers and new houses / self builds only, who can claim based on the lesser of:

  • 10% of the purchase price of the home 
  • Income Tax and DIRT paid by the individual in last 4 years, or 
  • €30,000

Stamp Duty - higher charge to tax on multiple purchase of properties

A 10% rate of duty currently applies to purchases of multiple residential units (i.e. 10 or more such units) within a 12 month period. This is mainly targeted at the acquisition of such properties by institutional investors.

The Finance Bill included a number of technical measures designed to reinforce the operation and administration of the increased rate of duty, to include:

  • Ensuring that the increased rate applies also to cases of indirect acquisition of units say through the purchase of shares in a company (where a 1% rate may otherwise apply) 
  • Clarifying that a residential unit within an apartment block is outside the scope of the increased rate 
  • Underlying the exemption which applies to any residential unit which is leased to certain social housing providers on the same date as its acquisition