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Repayment of Stamp Duty where land used for Residential Development

Repayment of Stamp Duty where land used for Residential Development

Section 83D of the Stamp Duties Consolidation Act 1999 as inserted by Section 61 of the Finance Act 2017


Repayment of Stamp Duty where land used for Residential Development

Introduction

The Finance Act 2017 introduced a mechanism for repayment of stamp duty paid on land where that land is subsequently used for residential development, such that if the maximum amount of stamp duty is repaid under the mechanism, the effective rate of stamp duty ultimately payable would be 2%.

Repayment of Stamp Duty – criteria

Stamp Duty paid on instruments executed on or after 11 October 2017 that relate to the transfer of non-residential property and on which 6% stamp duty liability was paid, may be repaid by the Revenue Commissioners up to a maximum of two-thirds of such stamp duty paid,  if construction operations of one or more dwelling units on the land commence on or before 31 December 2021 and pursuant to a commencement notice within the period of 30 months following the date of execution of the deed.

Clawback provisions

The section contains clawback provisions and any repayment of stamp duty will be clawed back if:

  • the residential development is not completed within the period of 2 years of issuance by the relevant building control authority of their acknowledgment of the commencement notice; or
  • when the development is completed: (i) at least 75% of the total surface area of the land is not occupied by dwelling units; or (ii) the gross floor space of dwelling units on such land does not amount to at least 75% of the total surface area of that land.

The Repayment

The amount to be repaid is determined by the formula A x B x 2/3 where:

A = the amount of stamp duty paid (at the rate of 6%); and

B = the proportion of the area of the land on which residential development occurred,

      expressed as a fraction.

Documentary evidence in relation to repayment of stamp duty

To satisfy themselves that either the conditions for the making of a repayment, or the conditions for the avoidance of a claw-back, are satisfied, the Revenue Commissioners may specify documents and particulars be submitted, to include the following:

  • copy of any commencement notice
  • copy of any acknowledgment sent by the Building Control Authority
  • copy of any planning permission granted
  • the number and gross floor space of dwelling units constructed
  • the area of the land expressed in hectares.

All relevant documentation should be retained by the claimant for six years, as same may be requested by Revenue to evidence the legitimacy of any such claim.

Making a Repayment Claim

Once construction operations have commenced pursuant to a commencement notice acknowledged by the Building Control Authority, a claim for a repayment can be made by an accountable person by electronic means (in a form and manner yet to be specified by Revenue) and should include a statutory declaration stating that construction operations of one or more dwelling units on the land commenced pursuant to a commencement notice within the period of 30 months following the date of execution of the deed, and (where a claim relates to a part of the stamp duty paid) the proportion of the area of the land represented thereby. Note that a repayment does not carry interest (although interest shall be repayable on a clawback) and cannot be made after the expiry of 4 years following the date of acknowledgment by a Building Control Authority (notwithstanding the development might be carried out in phases).

Appeal

If Revenue refuses the repayment they shall notify the claimant in writing of the decision and the reasons for it, who may appeal to the Appeal Commissioners within 30 days of receipt of any such notice.

Single-unit developments and multi-phased developments

While the above relates to multi-unit single phased developments, Section 83D of the Stamp Duties Consolidation Act 1999

also applies to single-unit developments and multi-phased developments with the conditions set out above modified accordingly.


Author: Vicky Pigot

12 April 2018

ALL CHANGE? The Sectoral Employment Order (Construction Section) 2017

A Sectoral Employment Order for the general construction industry has been signed into law by the Minister for State at the Department of Business, Enterprise and Innovation.

The Sectoral Employment Order (Construction Sector) 2017 (the “Order”) gives effect to measures recommended by the Labour Court in July 2017 relating to pay and conditions for employees in the general construction sector and takes effect from 19 October 2017.

Who does the Order affect?

The Order relates to the general construction sector, including operatives and general craft workers and so affects all employers and employees (whether agency or otherwise) in both “Building Firms” and “Civil Engineering Firms” (“the Sector”) which definitions are historically widely accepted.

The objective of the Order is to set the mandatory pay and conditions of employment for a basic hourly rate for the Sector and two higher rates of pay based on the level of skill of the operatives concerned. Therefore, employers within the Sector are first tasked with categorising their employees and workers.

Categories and Pay Rates

In relation to pay, specific mandatory pay rates have been set for categories of workers in the Sector, as follows:

Category 1 Worker: Skilled general operatives who have worked in the Sector for more than one year: €17.04 per hour.

Category 2 Worker: Skilled general operatives including scaffolders who hold an advanced scaffolding card and who have four years’ experience, banks operatives, steel fixers, crane drivers and heavy machine operators: €18.36 per hour.

Craft and New Entrant Workers: Bricklayers/Stone Layers; Carpenters and Joiners; Floor Layers; Glaziers; Painters; Plasterers; Stone Cutters; Wood Machinists; Slaters and Tilers: €18.93 per hour. Apprentices in these trades are to be paid at one third of the full craft rate, rising to 90 per cent of the full craft rate in their fourth year. Notably the categories do not include electricians and plumbers. Operatives who are over the age of eighteen and entering the sector for the first time: €13.77 per hour.

Extra Time Pay

The Order also fixes unsocial hours payments at either “time plus a half”, or double time, depending on the timing of the work. The Order does not include provisions on travel times as the Labour Court requires further consideration of the many legal and technical issues before it is in a position to come to a definitive recommendation. Existing contractual arrangements in this regard remain in force.

Pension

The Order provides that employers must provide a pension scheme to workers from the age of 18, with no less favourable terms, including both employer and employee contribution rates, than those in the Construction Workers Pension Scheme.

Sick Pay

The Order provides for a mandatory sick pay scheme with mandatory employee and employer contributions in line with the Construction Industry Sick Pay scheme. Employers who fail or neglect to make the authorised deductions shall be liable for the total contribution required to ensure that the worker’s sick pay benefits are maintained in full for the period of service with them.

Dispute Resolution

The Order provides for individual and collective grievances with recourse in the first instance to the employer; then to the WRC and then the Labour Court.

No industrial action can take place in relation to matters the subject of the Order until the dispute resolution procedure has been exhausted.

Next Steps

Employers in the Sector will need to categorise their employees and then review their terms and conditions to ensure that they comply with the Order. The Order applies from the 19 October 2017 and is legally binding on the Sector. The provisions are enforceable by the WRC.

Any Questions?

Contact Jenny Martin of Kane Tuohy, Solicitors at jmartin@kanetuohy.ie or telephone 016722233

Legal Secretary Required

Kane Tuohy Solicitors based in Dublin 2 are seeking a Legal Secretary to join their litigation practice. This role requires an experienced candidate who has initiative, drive and practical experience in preferably Commercial Litigation/Debt Collection/Employment. This is a full time permanent position working for 2 Solicitors.

Duties will include:
Providing full support to two solicitors in managing their portfolio of files to include audiotyping, scanning and assigning of post, arranging meetings and maintaining a diary system and creating and editing legal documents.

The ideal candidate will have:
• Experience working as a litigation legal secretary;
• Good organisational skills;
• Excellent computer skills including knowledge of Word, Excel, Outlook and Keyhouse case management;
• Experience in audiotyping;
• Excellent writing, interpersonal and communication skills;
• Pro-active approach to work and willingness to learn.

Salary negotiable depending on experience.
If you wish to apply for this role please email a CV and covering letter to: mbarron@kanetuohy.ie

Judgment of Ms Justice O'Malley

Judgment of Ms Justice O’Malley

13 Sept 2013

Ms Justice O’Malley today confirmed Bank of Ireland’s right to appoint a Receiver under Mortgage over properties owned by former Irish Rugby Star, Frankie Sheahan and his brother Joseph Sheahan, and clarifies the Receiver’s right to possession of rental property. Hugh Kane of Kane Tuohy acts on behalf of Bank of Ireland and the Receiver, Micheal McAteer.

Please click on the attached PDF to view Ms Justice O’Malley’s Judgment, or one of the links below to read articles:-

Irish Times
Independant
RTE.ie
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