The Living City Initiative – An Overview
The Living City Initiative was introduced by the Finance Act, 2013 and is a scheme of property tax incentives, designed to regenerate both residential and commercial buildings in specified cities, one of which is Limerick.
The relief can be split into two elements – commercial and residential.
- The relief is only available for owner/occupiers of buildings built for use as a dwelling prior to 1915. Therefore, for example, an old derelict church located within the “special regeneration area”, which is to be converted into a dwelling does not qualify, as it was not originally built as a dwelling.
- Landlords cannot claim relief under the residential arm of the Initiative.
- The claimant is entitled to a deduction from their total income for each of 10 consecutive years of an amount equal to 10% of the qualifying expenditure.
- A “Letter of Certification” must be obtained from the applicable Local Authority before any works have commenced.
- The property must be occupied as the claimant’s sole or main residence for all or any part of each year for which he is claiming the relief. The claimant is not obliged to occupy the property for the entire 10 year period but no relief can be claimed for any year in which there was no period of occupation by the claimant.
This is a laudable initiative launched by Minister Noonan with the aim of encouraging people back to the centre of Irish cities to live in historic buildings and encourage the regeneration of the retail heartland of central business districts. So far the uptake in Limerick city has been minimal. One criticism of the residential relief is that the period of the relief is spread out too long. Another observation is that, historically, Limerick city dwellers have tended to be transient. This initiative should be seen as one element of the overall rejuvenation of these designated areas. Hopefully, it is a relief that is embraced.
The scheme applies to certain “special regeneration areas” in Dublin, Cork, Limerick, Galway, Waterford and Kilkenny.
The relief applies to both residential and commercial refurbishment and conversion work.
These works must be incurred in a 5 year period from 5 May, 2015.