Saturday 21 October 2017

Majority allowing Revenue to take property tax cash

The new property tax form
The new property tax form
MOST people have given permission to the tax authorities to go into their bank accounts to take the property tax

Charlie Weston Personal Finance Editor

MOST people have given permission to the tax authorities to go into their bank accounts to take the property tax.

This has been interpreted as householders coming around to accepting the controversial tax on homes.

New research indicates that more than half of households that are paying the local property tax are now using a direct debit or a single debit authority.

Setting up a direct debit allows Revenue to take money out of your bank account to pay for the tax on a monthly basis.

With a single debit authority Revenue makes a one-off transfer out of your bank account to cover the cost of the tax.

Revenue figures obtained by Taxback.com show that 55pc of homeowners paid the tax this year by direct debit or single debit authority.

This was up from a third of households last year, Christine Keily of Taxback said.

She said this indicated a more planned approach to the payment of the tax and a grudging acceptance of it.

When the tax was first introduced, half of homeowners used their debit card or credit card to pay the charge.

"The increase in the number of people using single debit authority, direct debit or by deduction at source points to greater acceptance of the new tax," the accountancy expert said.

When the household charge was first introduced in 2012 – and was later followed by the property tax – people were more inclined to use a debit or credit card. These are payment methods generally used for one-off, infrequent payments.

"With the growing size of the tax due, many are switching to more frequent, spread payment methods such as direct debt or deduction at source as one-off payments become unmanageable," she said.

"Many of those who still opted for a one-off payment delayed it until March 2014 by selecting the single debit authority, rather than the debit or credit card payments which were payable with the return."

She said most people coped reasonably with a one-off payment of €100 to €150, but started to struggle when the amount was higher.

This meant it was inevitable that the number availing of monthly payment methods was going to rise over the next couple of years.

And many people had not realised up to recently that they could spread their payment with no financial penalty.

Ms Keily said she expected the proportion of people using spread payment methods to grow next year.

Irish Independent

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