|
Much has been made in recent times of the new €100 Household Charge and about campaigns for not paying it. The charge is worded so that any property owner who owned a property on the 1st January is liable to pay, and it must be paid by the 31st March. With three weeks to go until the payment deadline, the majority of householders have yet to pay. So the question is; what does the Government have in store for those who don’t pay? Pain and suffering of course.
Late Payment Fees
Section 7 of the Local Government (Household Charge) Act 2011 provides for a late payment fee as follows:
|
Up to 6 months late
|
10% of the outstanding amount
|
|
6 to 12 months late
|
20% of the outstanding amount
|
|
Over 12 months late
|
30% of the outstanding amount
|
On top of this interest will have to be paid at the rate of 1% per month on the unpaid charge. As such if the €100 is not paid for two years you will be faced with a bill of €296, or just under 22% interest.
What about just ignoring it?
A recent scam email purporting to be from McCann Fitzgerald Solicitors in Dublin claimed that the Local Goverment charge would only work if people “consented” to it by registering. This is an appealing idea, but unfortunately it has no legal basis. The first provision of interest is section 6. This provides that the owner of a property must declare on www.householdcharge.ie information including their name, address and PPS number before the 31st March of face a “Class C” fine, which is a fine of between €1000 and €2500. There is no provision for going to jail, but it is possible in theory at least as the ultimate consequence of a repeated failure to pay.
It is unlikely however that the government will bother making martyrs out of anyone. After all, they have more elegant ways of getting the money.
Death and taxes
The Act provides that should a householder die with an outstanding Household Charge, the personal representatives shall pay it within three months of the grant of representation issuing. The interest and charges will be paused for three months after the grant, but after that the estate will have to bear the cost of additional late payment fees.
Burden on the Property
Again the Goverment has provided an elegant if infuriating way of ensuring the Household Charge is collected. The amount owing, complete with late payment fees and interest will be a burden on the property for a period of 12 years from the date it first became due and owing. So it becomes in essence a charge on your property, and will need to be removed come time to sell or remortgage with a Bank.
This is reinforced by section 10 which provides that before the completion of any sale all household charges, late payment fees and late payment interest shall be paid. Failure to do this is a criminal offence and not only can the vendor be liable, but also the vendor’s Solicitor.
Section 11 of the act provides that any attempt to forge a document in respect of the Household chare will incur custodial sentences of up to 2 years or a fine of €25,000.
Privacy?
The Data Protection Acts are largely ineffective when it comes to controlling how the Government uses private information. While companies from Facebook to Google to SMEs need concern themselves with privacy policies and getting consent from users to share information, by virtue of Section 8(e) of the Data Protection Act 1988 all the Government need do is pass a piece of legislation. As such the Household Charge Act 2011 provides the following bodies must assist Local Authorities with information gathering:
- the Private Residential Tenancies Board
- the ESB
- the Revenue Commissioners,
- the Department of Social Protection
- any other public body that the Minister for Environment, Community and Local Government deems appropriate.
The last provision in particular sails somewhat close to the wind of what is constitutionally permissible, and could be considered in legal parlance a “Henry VIII” clause, whereby a particular minister is given undue latitude to make policy decisions without the need for additional legislation.
The minster may also provide that the local authority must share the information it collects with any one provided it will assist the person in discharging a function delegated to that person by legislation. So far Phil Hogan has added two state agencies which provide support services to local authorities under this provision and it remains to be seen if more substantive bodies will be added.
Exemptions
The most valuable exemption is where a property is in an unfinished estate. The concept of unfinished estates is quite broad, and in Cork it includes estates such as Clarkes Wood, Mount Oval and Maryborough Ridge, along with Ros Ard, Fernwood and Crawford Manor in Glanmire. The full list is available here. This exemption will only apply for 2012 and 2013 however.
There are also exemptions where a person had to leave their house due to ill health, but no exemptions exist for people in receipt of social welfare or are in negative equity. A waiver can be got however were a person is in receipt of mortgage interest supplement.
Dont forget the NPPR
If you own a second home or holiday home you will also be liable to pay the "Non-Principal Primary Residence" charge of €200 per annum. Late payment fees in this case are even more draconian and if you omitted to pay the charge for 2009, 2010 and 2011, you now owe €1800. The NPPR becomes due each March 31st and must be paid by June 30th.
|
