Do we pay tax on poor inherited property?
Q We have two properties. Our father died 2.5 years ago and his estate has only recently been sorted and properties have not yet been put up for sale and, given the current climate, I don’t see it happening soon. One residence is not habitable without major work being done (has not been lived in for 10 or so years) and we have no plans to rent the other, though it is in good order – the abroad sibling occasionally comes home. Could you advise if we are liable to pay tax on both properties given the actual state of them and, if so, would it be more prudent if two different siblings details were used – one for each – or should the executors give their details on behalf of everyone?
AIt's not entirely clear from your e-mail who owns the houses. If ownership of the houses has now passed to you or your siblings, then whoever owns the properties are liable to pay the new €200 Non Principal Private Residence (NPPR) tax. Your question appears to really relate to the standard of the houses. Remember one man's uninhabitable wreck can be another man's charming fixer-upper – if you don't believe that, look at the falling down properties in need of major renovation still being offered for high prices in remote parts of the country. Put simply, whoever owns the houses your father left must pay the €200, if no one lives in them as their principal private residence. It doesn't matter whether they are rented out or if they are in bits.
One of the owners can opt to pay the lot and collect from the siblings if that makes it easier for you. Go to nppr.ie for more information – and to pay online.
No one knows I own the house, so why pay 200 tax?
Q I have a modest summer home which has been passed down through my family for two generations. It has never been rented and is an entirely private matter. I don’t intend paying the new €200 tax because, basically, who knows I own the house? I feel this new tax is just a way of getting people such as myself to register and then the tax will be hiked up.
AYou are probably correct in your assumption that the €200 tax is a simple way to reel you in and put you on a database for future taxes. It is, after all, at €200, relatively low.
However, as someone who owns a second home you won’t stay under the radar forever. One of the duties of a solicitor when it comes to dealing with a deceased person’s estate is to make sure that all taxes and obligations are met, so when it comes to the time that you wish to do as previous generations of your family have done for you, and hand down the house, then your son or daughter or whoever will have to pay the tax which, by then, will also include severe accumulated late payment penalties – currently running at €20 per month.
Do you really want to land your heirs with a significant tax bill?
Your questions
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