Q&A Dominic Coyle
Can the Revenue force me to pay 2014 local property tax this year?
I have received a letter from the Revenue about next year’s Local Property Tax. It tells me that I need to let them know by November 7th how I intend to pay.
I paid by Laser card last year but obviously the bill is twice as large this time around and they say they will take the money as soon as I confirm I am using the Laser card again.
I think they’re behaving in an unforgivably strong-handed manner over this. There’s no way I can pay that sort of money with Christmas around the corner. Surely I cannot be forced to pay next year’s tax in full this year?
Mr O.D., Dublin
Given its role in chasing us for tax, the Revenue generally struggles for friends. On this occasion, however, I think it is getting a bum rap.
No one is forcing anyone to pay the tax upfront and in one lump sum. If, however, you choose to do so, it is unclear why you expect a debit or credit card payment in this case to operate any differently than it would in any other situation.
If you buy tickets today for a popular concert next year at the O2 or flights for next summer’s holiday, the likelihood is that you would generally pay with a credit card or a debit card, something like Laser or Visa. So what happens then?
Does Michael O’Leary ring up to say “not to worry, we won’t be drawing that payment down until you’re at the airport”? Does Ticketmaster confirm your booking for a gig possibly over a year ahead but charitably hold off on taking payment, trusting that you’ll do the right thing when you arrive at the venue?
Of course not. Whether it’s shopping for groceries or for any other good or service to be consumed now or at some time in the future, payment with a debit card is always deducted immediately from your account, that’s the whole point of debit cards: they operate like cash payments without you having to physically carry around the money.
In the case of a credit card, the payment is also credited to your account and billed at the end of the month when, if you’re sensible, you’ll pay it off in full to avoid attracting onerous interest charges.
Everyone knows this so it’s a bit of a mystery (to me at least) why it should have caused such a brouhaha this time around – much more intense than last summer when, after all, exactly the same choices were available, albeit for a half year’s tax.
This is especially so as Revenue is not insisting that people pay the tax in a lump sum, or ahead of time. Revenue is offering the option of lump sum or staged payments. In fact, it is offering a very broad range of seven options for paying the local property tax bill.
So what are they?
direct debit (phased payment taken on the 15th of each month from your bank account)
debit card (lump sum taken as soon as you notify Revenue of this option)
credit card (lump sum billed to your account as soon as you notify Revenue of this option)
deduction from wages / occupational pension / welfare payments / certain payments from the Department of Agriculture (phased payment spread evenly over your annual wage / pension / welfare or farm payments)
single debit authority (lump sum taken via a once-off debit on your bank account in March 21st, 2014 – a bit like if you had written an “electronic” cheque for the full sum dated March 21st, 2014)