On 18th December 2024, the Department of Housing Local Government and Heritage issued Circular Letter NRUP 03/2024 to accompany new Section 28 Guidelines entitled ‘Residential Zoned Land Tax Change in zoning of lands subject to existing economic activity’. The purpose of the Guidelines is to set out guidance in relation to proposals to amend the zoning of lands which are subject to existing economic activity, made by requests to amend zoning. The guidelines are intended to address situations where agricultural uses are ongoing but may be applicable to industrial / office and other land uses where there is an established economic activity.
In brief, the RZLT applies to land that is both zoned for residential development and serviced. Draft RZLT maps were published by local authorities in November 2022, with the supplemental map published in May 2023, a further revision was published by local authorities in February 2024.
The Guidelines recognise that there may be specific circumstances where lands currently subject to an existing bona fide economic activity are zoned for residential development, however the owner of the land in question does not wish to develop the land for that purpose, specifically stating that “Economic uses, especially those which have been operated over generations, will have benefitted from investment, provide employment in the local area and are part of a balanced approach to ensuring a variety of uses in support of sustainable communities.” The Guidelines and Circular provide further information on two main issues as follows:
1. Considering Change in Zoning Requests
The Guidelines state that Councils must consider requests to amend zoning objectives. An additional opportunity is being afforded to landowners to request a change in zoning of their land, where that land is identified on the annual final maps for 2025, which are to be published by local authorities by 31 January 2025. Requests can be made to the relevant local authority between 1 February and 1 April 2025, with a requirement for the local authority to provide written acknowledgement of the request.
The landowner can use the written acknowledgement to seek an exemption from the requirement to pay the 2025 tax liability, which arises on 1 February 2025 for the land identified in the request, subject to certain conditions. The exemption only applies where a request to amend the zoning of land in respect of an existing economic activity has been made.
2. Extant Permissions
A landowner will not be able to seek a tax exemption for land where the planning history of extant permissions or current planning applications demonstrates an intention to develop the land for any purpose not related to the existing economic use.
Where extant planning permissions have been granted or applications for such development are under consideration, details of the planning permission or application as entered onto the planning register and a copy of the site location map submitted as part of the planning application shall be contained in the rezoning request to be provided to the landowner by 30 April 2025.
New Policies and Objectives
While the provision to request an amendment to a zoning were previously included in the Finance Act, the Guidelines introduce 2 no. policies to reflect the above provisions, namely 1(a) and 1(b) as follows:
Policy and Objective 1(a):
“Subject to Policy and Objective 1(b), it is a policy and objective of these Guidelines, that where an owner of land which is:-
submits a request to a local authority under Section 653I of the Taxes Consolidation Act 1997 (as amended) seeking an alternative zoning of their land, stating that they wish the economic activity to continue for the duration of the life of the development plan, such a request should be facilitated by the planning authority under the provisions of Section 13 of the Planning and Development Act 2000 (as amended).” (Our emphasis)
Policy and Objective 1(b):
“Having regard to the objective of the Residential Zoned Land Tax to activate land which has benefitted from planning permission for development, including housing development, it is reasonable for a planning authority, when considering whether to commence the process of considering a variation to the development plan under section 13 of the Planning and Development Act 2000 (as amended) as a consequence of a request to change a zoning objective relating to land received under Section 653I of the Taxes Consolidation Act 1997 (as amended) to have regard to the planning history of the land in question.
Where there is an extant planning permission in place for a development other than related to the continuation of the existing economic activity, or where there is a planning application or appeal under consideration for a development which seeks to develop the land for other purposes which do not relate to maintaining the existing economic use, Policy and Objective 1(a) shall not apply.” (Our emphasis)
The Guidelines do not define ‘Economic Activity’ but state that ‘Economic uses, especially those which have been operated over generations, will have benefitted from investment, provide employment in the local area and are part of a balanced approach to ensuring a variety of uses in support of sustainable communities.’
Note: This Planning Insight summarises some of the key provisions of the new Guidelines, however, the RZLT legislation process and guidelines are complex, and specialist advice should be sought in assessing any particular case.
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