Derelict Property Tax: What Owners Need to Know
Summary
A new Derelict Property Tax of 7% of market value will replace the current derelict sites levy. It was first announced in Budget 2026 and confirmed in Budget 2027 on 6 October 2026, with legislation to follow in the Finance Bill.
Revenue will collect the tax, using registers that local authorities are required to compile. Owners of properties on those registers will be liable for the tax unless the dereliction is addressed.
For owners, the tax adds a holding cost to idle properties. We expect this to encourage refurbishment, redevelopment and sales, which could bring more properties to the market sooner than would otherwise have been the case.
Key dates
The timetable below is based on the current announcements. Dates may move as the Finance Bill is progressed.
| Date | What happens |
| 1 January to 31 August 2027 | Local authorities inspect towns and identify derelict properties |
| 1 September 2027 | Preliminary registers of derelict properties are published |
| 1 September to 30 November 2027 | Owners can ask for a review of their property’s inclusion on the register |
| From 2028 | Tax applies to properties on the registers, collected by Revenue |
Who is affected and how it is calculated
The tax applies to residential and non-residential property. It is charged at 7% of the property’s market value, and is self-assessed, so owners will need to declare it to Revenue. Revenue will apply normal tax collection and enforcement, including penalties and interest.
Local authorities will still identify derelict properties and maintain the registers. An example of a sign of dereliction is failing plasterwork or unsecure brickwork.
The precise legal definition of a derelict property is still to be finalised.
Options for owners
Owners can avoid liability by taking steps, so the property is no longer considered derelict. The main routes are:
- Refurbish the property and bring it back into use
- Redevelop the site
- Demolish and clear any derelict structure
- Sell to an owner who will redevelop the property
Open points
- The legal definition of a derelict property is still to be confirmed.
- The start date and the exact registration process will be set out in the Finance Bill.
- Owners should check the preliminary register once it is published on 1st September 2027 and use the review window if their property is included in error.
- Unpaid derelict sites levies remain the responsibility of local authorities, which can continue to pursue them after the new tax begins.
How Franklins can help
If you own a property that may be affected, contact our office on 074 918 8000 or at [email protected]. We can:
- Review whether your property is likely to appear on a register
- Advise on the realistic sale value of the property in its current condition
- Market the property to buyers who intend to redevelop it
- Provide a sales valuation and a proposal for selling the property
If you are thinking about selling, see our guide to contract-ready properties.
This note is general information and not tax advice. Please speak to your accountant or tax adviser about your own position.