Your Questions About Personal Finances – Do I Have to Register My New Home for Local Property Tax?

Q Earlier this year I bought my first home and moved into it. It is a newly built property. My father tells me that for Local Property Tax (LPT) purposes I need to register the property with the Revenue Commissioners this November. I thought the property was exempt from LPT because it was newly built?

A Your father is right. Your home is subject to local property taxes and therefore you must submit your LPT return by November 7, according to Excise Tax Manager at Marian Ryan.

You don’t have to pay your LPT bill by November 7th. You can wait until the New Year to do that. You may be confused with an exemption that previously applied to new home buyers. New and previously unused properties purchased from a builder or developer between January 1, 2013 and October 31, 2021 are exempt from the LPT, Ms Ryan said.

This exemption no longer applies. When filing the LPT for your home, you must value your property as if it existed in a complete condition as of November 1, 2021, even if it hadn’t been fully constructed by then, she said.

The date you need to pay your LPT bill depends on how you want to pay it. For example, January 10, 2023 is the date by which you must pay your bill if you intend to pay it in full by cash, check, or debit or credit card.

You can also spread your LPT bill over 2023, but you must let Revenue know how you plan to do this by December 2nd of this year.

Q Strong winds tore off the roof of my house during a severe storm, causing major structural damage. When I made a claim, my insurer told me they wouldn’t pay the entire bill for repairs. It said I had underinsured my house by about 30 percent. For this I have to pay at least 15,000 euros of the bill myself. This can not be true?

A Many homeowners may be getting only a fraction of the payout they expect from their insurer this fall and winter because they unknowingly underinsured their homes. According to People Insurance CEO Paul Walsh, this is largely due to rising construction costs.

What appears to have happened in your case is that if your home is damaged or destroyed and needs to be rebuilt, the maximum home insurance sum your insurer will pay is too low.

An insurer reduces its liability for damage to a home in proportion to the amount of underinsurance

You may only have insured your home for €280,000, but the real cost of rebuilding it is €400,000. If this is the case, your insurer can reduce coverage by 30 percent for any claim, regardless of the amount of the claim.

That’s because home insurance policies usually have an averaging clause built in, whereby an insurer reduces its liability for damage to a home in proportion to the amount of underinsurance, Mr Walsh said.

With the insurers, all conversion costs within a fixed range are charged at the same rate. So you might find it will cost you little or nothing more to add your home’s rebuilding value to your home insurance policy, he said.

Q I started saving for a house a few years ago, but I seem to have saved at most €1,000. I never borrow money for things like car insurance, road taxes, or a vacation, but that means I end up dipping into my home savings for those expenses. How can I build up my home savings better than before?

A It’s a good thing you’re not borrowing to pay for things like vacations and road taxes, says Stephen Rice of Aviva Life and Pensions.

He suggests taking a three-pronged approach to saving, so that long-term goals (like retirement or children’s education) are earmarked in a life insurance savings plan, while saving for medium-term goals (like a house) is earmarked for a holiday or home Set up a termination savings account, then used a call money account for short-term goals.

Avoid the temptation to make your checking account your easy-access account, advises Mr. Rice.

Set realistic goals for how much you can save

You’ll find it easier to save for short-term goals if you have that money in a separate account from which you pay your daily bills. Set realistic savings goals by looking at your daily expenses and disposable income.

Once you’ve settled on a level of savings that you’re comfortable with, then decide how much you want or need to put into each of the three buckets.

Because your circumstances may change, it’s important to review your savings annually to make sure they’re meeting your goals. Your Questions About Personal Finances – Do I Have to Register My New Home for Local Property Tax?

Fry Electronics Team

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