Residential Zoned Land Tax – insights from practice

In this article, John Walsh and Aaron Mullan from PwC discuss the Residential Zoned Land Tax, providing a detailed overview of the tax and practical insights from their experience advising clients in recent months.

Introduction

The Residential Zoned Land Tax (RZLT) was introduced with the aim of activating land for residential development. 2025 was the first year of the charge to RZLT, with Revenue recently announcing that approximately 1,800 returns had been filed and nearly €40 million collected.

This article provides a brief reflects on the first compliance cycle, highlights some practical points areas where specific attention is required to RZLT and provides an overview as to where things stand following Budget 2026 and the publication of the first draft of Finance Bill 2025.

Brief Overview

RZLT is a self-assessed tax of 3 percent of the market value of the lands which are (i) included on final RZLT maps published by local authorities and (ii) which are not residential property. Local authorities therefore have a key role in preparing maps including land which they consider meets the ‘relevant criteria’ to be within the scope of RZLT. When land meets the above criteria for the first time (i.e., becoming a “relevant site”), the land is subject to RZLT annually, beginning with the third year following the year in which the land first meets the criteria.

The mapping process

Landowners should be aware of the mapping process which starts with the publishing by local authorities of draft maps on 31 January in the calendar year prior to the liability date, as well as their ability to make a submission and or appeal against the inclusion of their land on draft RZLT maps.

In our experience, many landowners have been surprised to find their land on a draft and ultimately final published RZLT map, so it is critical that landowners review the annual draft maps and prepare any necessary submissions or appeals in advance of the deadlines, particularly as we have seen Revenue take a firm approach that land on the final published maps which is not a residential property is within the charge to the tax.

1 February and 23 May

1 February is a key date in the RZLT calendar. Any land which is in scope of RZLT on that date each year is subject to RZLT (subject to the 3-year rule mentioned above). This is the date on which the ownership of a relevant site is key. This is also a key date for establishing if a deferral or exemption is available and the date on which the market value of the site must be ascertained (such market value broadly remaining in place for 3 years).

Annual RZLT returns are then due for filing on 23 May and payments are also due on that date (unless, for example, accelerated due to a sale of the land, as discussed further below).

In our experience to date, the RZLT system on the Revenue Online Service (ROS) can take a number of days to process requests, so we recommend that agent link and site registration requests should be submitted well in advance of the deadlines.

Reliefs from RZLT

The most common deferrals, exemptions and exclusions from RZLT are as follows:

• A deferral due to an appeal or application for a judicial review against land being included on the local authority’s RZLT map.
• A deferral where a third party appeal against an Coimisiún Pleanála’s (“ACP”) decision to grant planning permission[1].
• An exemption where a third party makes an application for a judicial review against ACP’s decision to grant planning permission, or a third-party appeal of a determination of such a judicial review.
• A 12-month deferral upon the granting of planning permission.
• Non-residential development taking land outside of the scope of RZLT.
• A deferral (and potential abatement) in respect of residential development.

Care must be taken when claiming any of the above deferrals, exemptions, or exclusions to ensure that any relevant conditions are met and the clawback provisions should also be monitored. It is worth noting also that Revenue’s stated view in Tax and Duty Manual 22a-01-01 is that an RZLT return must be filed on time in order for a claim for any relief to be valid.

Practical issues and challenges arising for taxpayers

For RZLT purposes, there are some key differences between the availability of potential reliefs where an appeal is brought to ACP against a site’s inclusion on a RZLT map prepared by a local authority compared to an appeal being made against planning permission to ACP (where such appeals are undetermined on the liability date). There are also several differences when it comes to the reliefs available in respect of judicial reviews.

The below table illustrates some of these key differences. While the exemption in respect of judicial reviews/appeals of a judicial review determination (see bottom row) is on one hand more generous than a deferral afforded in the other scenarios (in that there is no clawback where the decision goes against the taxpayer), the exemption does not apply where the action was brought by the landowner (or a person connected with them). Unfortunately, this means that currently where a landowner has had their planning permission overturned by a judicial review decision and are in the process of appealing that determination, the exemption cannot apply, and there is no other relief afforded to the landowner, despite their efforts to obtain planning permission to activate the land.

Considerations on the sale of land

Since any unpaid RZLT liabilities remain a charge over a relevant site, RZLT has been an important consideration in transactions. The Law Society has drawn up guidance for legal practitioners dealing with the conveyancing of a relevant site.

From a tax perspective, the sale of a relevant site gives rise to a separate RZLT sale/transfer return filing requirement in advance of the conveyancing of the land to the purchaser and any unpaid RZLT liabilities must also be settled.  Certain deferrals from RZLT are clawed back upon the sale of a property, which results in the vendor having to amend previously submitted RZLT returns, and pay any RZLT arising as a result (plus interest). Finally, a screenshot of the RZLT liabilities screen on ROS should be shared with the purchaser in order to satisfy them that any RZLT liabilities have been paid ahead of transfer.

In light of the above and the continued evolution of RZLT we are seeing RZLT being a real focus area of tax due diligence in transactions and requests for warranties and indemnities being negotiated to allow transactions to complete.

There are relieving provisions which can provide that deferrals may continue to apply when land is transferred within a group, so it is worth checking if these apply. Even where a deferral remains in place, care should be taken to ensure administrative requirements, including the RZLT sale/transfer return, are complied with.

Forward fund transactions

A forward fund transaction involves a ‘developer’ selling land to a ‘purchaser’ and the purchaser simultaneously entering into a building agreement with the developer to develop the land. These transactions by their nature involve a transfer of ownership of land by the developer to the purchaser before the development of the residential property is completed. The forward fund transaction model is popular with Approved Housing Bodies (AHBs) and the Land Development Agency (LDA) in particular.

Unfortunately, where any of the below RZLT deferrals have been claimed, the legislation currently provides that they are clawed back in a forward fund scenario (with interest applying) due to the change in ownership of the land before the land is fully developed:

• The 12-month deferral upon the granting of planning permission.
• The deferral where a third party appeals against ACP’s decision to grant planning permission[4].
• The deferral in respect of residential development.

The clawback or unavailability of the deferral for the vendor is despite the fact that the purchaser may be able to avail of deferrals for RZLT liability dates arising after they obtain ownership of the land. While the purchaser is able to claim deferrals for future liability dates (with the potential of later abating RZLT altogether), the RZLT liabilities which arose up to the date of the transfer become an additional cost of the transaction to the developer. This is just one example of how the tax which was introduced with the aim of activating land for residential development can result in being an additional barrier to achieving that aim.

Tax Advisor Liaison Committee (TALC) RZLT sub-committee

The sub-committee has been set up as a forum whereby a number of practitioner bodies (including Chartered Accountants Ireland, under the auspices of the CCAB-I) may raise practical administrative issues with Revenue on a confidential basis and seek clarity on certain points of uncertainty. Meetings have increased in frequency in recent months and have brought clarity on certain areas, leading to updates in the Revenue guidance.

Updated Revenue guidance

Revenue has been periodically updating their RZLT guidance since it was first published in 2022. Revenue guidance now consists of 4 manuals (totalling 261 pages) plus an 18-page quick start guide. Revenue’s website also includes helpful videos on the following topics:

1. How to file an RZLT return.
2. How to claim a deferral of the payment of RZLT.
3. How to submit an exemption from RZLT

The most recent update to Revenue guidance came in August 2025, adding clarity to the agent e-linking process, while also providing guidance as to how an abatement from RZLT may be claimed upon the completion of a residential development.

The future of RZLT

While guidance in relation to the operation of the tax is welcome, reforms to the RZLT are required to allow it to achieve its original aim of activating land for residential development and in a manner that does not increase the cost of delivering housing further.

The first draft of Finance Bill 2025 was published on 16 October 2025, which proposes an exemption (rather than a deferral) where a third party has lodged an appeal with ACP in respect of the granting of planning permission. This is a welcome development. However, disappointingly, no changes to forward funding transactions are included in the first draft, nor are any changes to address various other issues with the tax, including situations where landowners are prevented from obtaining planning permission. It is hoped that further amendments can be made to the Finance Bill as it goes through the Oireachtas.

Various industry bodies and professional advisors have made submissions highlighting practical challenges and unintended consequences arising from the first year of operation. Landowners and developers are advised to monitor developments closely and continue to seek professional advice as the legislative landscape continues to evolve.

Aaron Mullan is a director in PwC’s real estate tax team. His main areas of expertise
include providing advice in relation to the property transactions, tax efficient structuring, reviewing tax models and analysing the impact of changes to tax legislation and Revenue guidance. Aaron represents CCAB-I on the TALC RZLT sub-committee. 

John Walsh is a senior manager in PwC’s real estate tax team, with a wealth of experience advising indigenous, financial services and international clients. His main areas of expertise include corporate tax consultancy, domestic and international tax structuring and advising on Irish real estate property related transactions.

[1] Please note that s.99(i) of Finance Bill 2025 proposes an exemption from RZLT where a third party makes an appeal to ACP against the granting of planning permission, thereby aligning such a situation with a judicial review/appeal of a judicial review.

[2] See footnote 1.

[3] See footnote 1.

[4] See footnote 1.