Is the new snitch clause fair on home buyers?

Earlier this week the government announced a new ‘snitch clause’ which puts pressure on home buyers to inform on sellers who have purposely lowered the valuation of their house in order to save on the new property tax.

Under the new rules, buyers will be obliged to tell the Revenue Commissioners if the previous owners put a dwelling in a band clearly lower than their selling price.

For example, if a home has been valued at €200,000 but then sells for €350,000, the new buyer would be forced into snitching.

Offending vendors will be fined €500 if they refuse to reveal the band declaration to buyers.

The question remains though whether it is fair or not on buyers that they should effectively be roped into becoming watchdogs for the Revenue.

Depending on the interest in a home, it could also sell for above or below the property tax band into which it falls.

It also puts a huge pressure on the purchaser, who has enough on their plate with buying and moving into a new home without having to tell tales on the last owners.

Equally, they could be worried about falling out with their new neighbours if they snitch as the government wants.

The impact of this new clause could have other effects too with Fianna Fáil suggesting it may even impact on the property market, which – like it or not – creates revenue in the economy.

Today we’d like to get your opinion on the new ‘snitch clause’.

Do you think it’s fair that home buyers should have to report the previous owners?

Would you feel comfortable reporting someone?

Let us know and have your say in the comments section below…

38 Comments

  1. Paddy
    Posted 15 Feb at 10:19 am | Permalink

    House sellers can’t run with the fox and hunt with the hounds on property values. When someone underpays their share, more is loaded on the rest of us. That is how tax works, even an unfair, anti-Dublin tax like the new property tax.

  2. CMC
    Posted 15 Feb at 10:21 am | Permalink

    As all selling information is in the public domain now and revenue will be responsible for stamp duty and property tax; why should anyone be burdened with a snitch clause..
    This is not about tax evasion it’s a reflection of the systemic incompetence of government.

  3. Barbara
    Posted 15 Feb at 10:26 am | Permalink

    May the snitchers burn in hell

  4. joehayes
    Posted 15 Feb at 10:28 am | Permalink

    Surely this is unnecessary. The Revenue know the band used and the Revenue know the selling price (from the stamp duty submission). The problem is there is no register of residential property whereby the Revenue can link these two. Create the register and solve the problem.

  5. alec fox
    Posted 15 Feb at 10:28 am | Permalink

    A Snitch used to be someone who was highly frowned upon but now it is the way things are Run and encouraged. Bring back the old days when you could actually trust someone.

  6. Rita
    Posted 15 Feb at 10:34 am | Permalink

    I agree with CMC, all informtion related to the sale of any property will now be in the public domain so why should it be necessary for a snitch clause at all, after all the Revenue say they are going to give out the valuation of the property and if you accept their valuation there will be no comeback if in fact your property is worth more? Only in Ireland do we introduce a property tax and already they are adding additional clauses so the Revenue are in a win, win situation. Could they not introduce a fair and equitable tax based on a combination of factors such as sq ft, location, etc as they do in other European countries. Why do we have to always reinvent the wheel?

  7. Shay
    Posted 15 Feb at 10:34 am | Permalink

    If the stamp duty is paid to Revenue when the sale completes then they automatically know what price it is. Surely this can be cross referenced with the declared price and remove the purchaser from the pressure of ‘snitching’

  8. Brid Carroll
    Posted 15 Feb at 10:35 am | Permalink

    There are times when buyers pay over the odds for a house that they particularly want ( it could be near a parent etc etc) . It would be unfair in this case to penalise the seller for undervaluing his / her house.
    The value of any house is the price someone is prepared to pay and that is not known in advance.

  9. seamus dooley
    Posted 15 Feb at 10:37 am | Permalink

    agree with CMC. the sale information is already in the public domain. why should purchasers have to do what revenue can do themselves. classic sledgehammer job – another effort to bully people

  10. Colm
    Posted 15 Feb at 10:43 am | Permalink

    So basically it becomes a tax on future value. In reality the house market is dead in the water because the banks are not lending. House prices are exceptionally low. So the calue today is exceptionally low. But say the government and banks actually do something to fix the market over the next couple of years (while you are locked into the current value for the home tax). That should see a rebound in house value. You could easily see 10-15% bump up which would push a lot of houses into a higher band. This snitch clause is nothing more than an insurance for the taxman that means he can claw back any extra tax that results in a housing market recovery.

    Of course they don’t have it working the other way. If house prices go the other way and fall further (which is quite possible given that a price rise is dependent on our incompetent government actually bucking their form and doing something right) then there is no claw back on the tax. There is no way for you to go to the revenue and say you overpaid the home tax.

    This tax is fundamentally unfair in that it taxes a made up value on a loss making asset to provide services which, in rural areas, never did and never will exist.

  11. Angie
    Posted 15 Feb at 10:45 am | Permalink

    A teachers response that adds more pain to the class and makes less work for the teacher.

  12. Dec Melia
    Posted 15 Feb at 10:47 am | Permalink

    The government have said all through the noughties that they could not interfere with the natural market price of property, now they are. I think €500 is a small levey to pay in order to get an extra €100000 for you house, fuck the taxman

  13. Giles
    Posted 15 Feb at 11:25 am | Permalink

    What is the Revenue thinking they must be on somewhat of wacky weed
    arae they nuts ? this is why Ireland and the irish people are leaving,Do you blame them?

  14. Joakim
    Posted 15 Feb at 11:25 am | Permalink

    Well, if the government intends to create a society in the style of East Germany during the Cold War, then this is a great start!!

  15. Socrates
    Posted 15 Feb at 11:36 am | Permalink

    ‘Snitch’ is what kids in a playground do…Snitch over trivial issues.
    What you are referring to in this article however, is tax fraud/tax evasion. Does myhome.ie consider this to be trivial?

    If someone is fraudulently claiming social welfare and you report them, are you a ‘snitch’?

    I have no qualms about reporting a theif… why should I pay full whack and then someone to cover their theft?

  16. jamesrogers
    Posted 15 Feb at 11:38 am | Permalink

    Socrates, myhome.ie did not give the issue its name, neither did it pass judgement, it simply asked was it fair and how people felt about it.

  17. Patrick
    Posted 15 Feb at 11:40 am | Permalink

    So if this is the case how often is the owner meant to estimate the value of their house and submit same? Could be rapid falls and rises for any number of reasons.
    I wonder will owners be able to reclaim tax if the house is sold for far less than the valuation used by revenue ?

  18. Posted 15 Feb at 11:43 am | Permalink

    What about the 30 percent who have decided not to pay.?
    Will this number rise,as the injustice of the tax becomes more apparent.
    This is simply an “urban tax”,penalizing those who need to live in cities.
    Rural home owners will pay far less.
    I do not believe that Revenue have the staff nor the will, to go through lengthy,time consuming procedures of bringing people before the courts in order to try and get an attachment order to stop monies from the income of families who are struggling to survive.
    If they do, the resulting publicity will harden the boycott.
    This whole business will,in my opinion,end up a total,chaotic disaster.
    It will remove the current parties from office as soon as the electorate get the opportunity.
    Big question is who will replace them-Sinn Fein in coalition with their former comrades in arms-the Soldiers of Destiny.?

  19. So silly
    Posted 15 Feb at 11:47 am | Permalink

    The Revenue sends me a letter valuing my house, that value is good for three years…. If in year three I sell my house and in that time the value has gone up based on demand ( I know I’m dreaming) How am I liable, for not knowing the future?? Am I supposed to frantically watch local sales prices over the course of that three years and inform the revenue?? The house price could be up one month and down the next… How can we predict the future sales price of our houses??? I really don’t get it.. Please someone explain.

  20. Stella
    Posted 15 Feb at 12:00 pm | Permalink

    Is is fair, no its absurd

    Fair ? no its absurd !

  21. Bernadettte Flynn
    Posted 15 Feb at 12:05 pm | Permalink

    In the name of God, have we learned nothing in this country?? Why do you think we are in this mess? BECAUSE NOBODY “SNITCHED!.
    What a terrible word – why not ask the question:
    IF YOU SAW A THIEF ROBBING YOU WOULD YOU REPORT IT?
    Of course I would!!
    Nobody snitched about the bankers, the developers, the social welfare frauds, the Politicians, the Pedophiles,the list is endless.
    Don’t fool yourself guys that they are “getting one over” on the Government – they are taking the money from my pocket and your pocket.

  22. Lindagar
    Posted 15 Feb at 12:24 pm | Permalink

    In case come posters above missed it… The QUESTION was: Do you think it’s fair that home buyers should have to report the previous owners?

    My answer is NO.. it is not only unfair but outrageous that the buyer has to “inform” on the seller.

    Let the Government and the Revenue do their own dirty work… that they have to resort to this justs proves how inept they really are!

    Oh.. and BTW… if we accept this – watch out!

  23. Donal
    Posted 15 Feb at 1:13 pm | Permalink

    During the penal laws there were rules about the price of a horse. A catholic was thus forced to sell at under the value of the beast. Caoineadh Art Ui Laoighre is all about the murder over the unfairness caused by the unjust laws. These new laws are framed with the same unjust and penal intent.

  24. Brian Buckley
    Posted 15 Feb at 2:02 pm | Permalink

    Totally unfair and actually IMO unworkable – I lived in the UK for 10 years and their Council Tax system works in a totally fair way – property is placed into bands following a valuation BY THE COUNCIL not the owner. These bands remain for a number of years (until the next valuation exercise) and crucially BEAR NO RELATION to the actual current market valuation. So the tax cannot affect the property market. What Revenue here is trying to do is retrospectively profit from a functioning property market. This is not only unfair but totally nuts! They risk interfering with the market to the extent that they depress it and hence actually REDUCE the tax take. Total incompetent IDIOTS!

  25. Mee Burke
    Posted 15 Feb at 2:10 pm | Permalink

    It is clear that the various Government Departments’ systems are not joined up and severe shortcomings. Look at how the Dept. of the Environment had to use the House Charge to get a register of residential properties in Ireland. Why should people have to play watch dog for an inefficient government? Revenue have access public sites, such as My Home, to get asking prices for all new properties that come on the market in a given week and they also have access to the Residential Property Price Register another public database. Do we have to spell it out? Another example of lazy government departments who cannot think outside of the box.

  26. Andrew
    Posted 15 Feb at 2:41 pm | Permalink

    Accountancy rules always placed the value (of what once was an asset) at the price paid for it.

    Didn’t work very well when the small business who bought a premises in the 70′s or 80′s went to a bank for a loan because the book value of the property was less than the cost of a minor upgrade or repair today.

    It worked for revenue because they made a killing on the capital gains, they will still make a killing on the stamp duty.

    Another “Threat” that makes me wonder are any of our Government services “Fit for purpose”?

  27. anthony jenkins
    Posted 15 Feb at 3:00 pm | Permalink

    there is big trouble ahead for this group of fools
    they are killing the goose that lays the golden egg
    there is no relief for the huge stamp duty we paided.
    money we badly needed for our homes now there on the take again, this will end badly, goverment should lead by example not by huge wage take and
    huge expenses, common sense will arise eventually
    by the real people of this country.stand up to
    europe, if you want there respect?

  28. John
    Posted 15 Feb at 4:33 pm | Permalink

    The new law is especially unfair for homeowners selling their house by auction, as it is possible that a house may sell for a higher than expected price depending on the level of interested parties. How can any homeowner know with certainty exactly what their house is worth at any particular moment in time ? Also what if you had used for property tax purposes, the value of a neighbouring house that sold several months ago and whose interior, unknown to you, was in poor condition, thereby dragging down its value, compared to your better maintained property ? You could now be punished for this, if your house sells for a higher price.

  29. alan Kennedy
    Posted 15 Feb at 5:18 pm | Permalink

    we paid enough in stamo duty, there should be no tax on those that paid already.

  30. kacy kaye
    Posted 15 Feb at 6:54 pm | Permalink

    answer to question, no it is not fair. let the government do their own work for their own salary. how come we can vote a government into power, but cant get them out when they prove completely incompetent and brainless. there are intelligent people in this country, would they think of getting together and form the new party we so badly need, so we can get rid of the present gombeens who cant even speak properly in public. um, eh mmm eh, um , de do, ect. please Ivan Yates, David McWilliams and a few like people, please form a new party and get rid of ALL the others, ALL others.

  31. Posted 15 Feb at 10:16 pm | Permalink

    thhis goverment is unable to feel the pain and anger of the nation,so until they are replaced at election time they will continue with their policies.minister noonan as minister of health did
    threathen a very seriously sick woman and her family,so this man has a track record of coldness
    ,so expect no mercy. the property tax is wrong in the way its being laid out.the snitch clause ,reminded me of the east european comunist nations.
    of course its wrong,it will create a bad culture.
    have they reduced their salaries,their pensions,
    their perks,not a cent.

  32. margaret
    Posted 16 Feb at 10:15 am | Permalink

    Can’t see what the big fuss is about … any buyer would be wise to make sure that any liabilities attached to the house they are buying have been dealt with before completion of a sale. Seems to me it would be up to the solicitor for the purchaser to ensure this is the case. Is myhome wittingly/unwittingly encouraging people to undervalue their homes for tax purposes??

  33. David
    Posted 16 Feb at 1:54 pm | Permalink

    1) Statement made on the home page at http://www.propertypriceregister.ie/
    ‘It is important to note that the Register is not intended as a “Property Price Index”‘. So where do get out prices from?
    2) on the register page it states ‘The Authority acknowledges that there may be errors in the data in the Register’. So where do I get reliable data from?
    3) Many descriptionms state things like ‘Second-Hand Dwelling house /Apartment’ How can we compare?

  34. Chris B
    Posted 16 Feb at 8:24 pm | Permalink

    Snitch clauses for property tax swindlers and a fine for the seller yet there has been how many fines and jail sentences issued to those former bank directors and still a hold up in the snitching protection laws that would allow someone working in a bank to be protected from prosecution if they were to snitch on the likes of Seany & fingers? This country is a bloody joke! In a perfect world everyone would pay their tax and their fair share of it too but to burden and stigmatise the blue collar workers into snitching while allowing white collar workers to live in relative peace and security knowing their dodgy deals will probably never be found out and no hurry being shown on it in the Dáil… Ridiculous!

  35. Michael O'Kelly
    Posted 16 Feb at 11:14 pm | Permalink

    No bloody way. Revenue Commissioners are there to collect TAXES. First they think they can value cars and now they are Estate Agents. Who the hell are they and what are they ? Do they sell cars and houses ? No. What they are is simple,Collectors of an unjust and unfair TAX that certain people will not have to pay i.e TD’S well those in government anyway.

  36. Posted 17 Feb at 5:14 am | Permalink

    As Shay and John have said, this is unnecessary additional red tape designed to intimidate buyer and seller. More of DIVIDE AND CONQUER!If stamp duty is paid, there is no need to have a SNITCH Clause. The HOME TAX should in the interest of fairness, be based on square footage, not value. Big Phil won’t agree to this as his constituents would end up paying more.

    When will Enda n Eamon get it right? All they seem to do is dodge questions in the Dail and even give the impression that the opposition should have the Gall to pose any questions. Then, they don’t answer the questions anyway. Democracy Enda n Eamon STYLE!

  37. Posted 17 Feb at 6:16 pm | Permalink

    i know of a house which was up for sale for 140k and could not sell,then the lowered the asking price to 120k and what do you know it started a bidding war it was sold for 146k.now is the person who sold the house breaking this new law.

  38. bridie
    Posted 18 Feb at 1:56 pm | Permalink

    as some others have pointed out, the value info is recorded by estate agents and registry which creates a professional ‘buffer’so there should be no need to force people to snitch on each other. This creates even more bad feeling between all parties concerned turning people against each other in a society already badly damaged by the attacks of its own government who have no conscience about breaking the law to suit their needs, dishonesty, also lining their own pockets and those of the ‘ruling elite’. Joakim has it summed up well.