Section 48 of the Environment (Miscellaneous Provisions) Act, 2015 was signed into law on 27th July 2015 and this amends The Water Services Act, 2014. This new legislation provides that a vendor must pay to Irish Water any water charge owing and provide his or her solicitor with a certificate of discharge or statement confirming that the vendor has no liability to Irish Water (Section 48.3A(2)).
Section 48 also provides that the vendor’s solicitor must withhold from the net proceeds of sale any amount owing to Irish Water, “after the discharge of all mortgages and other liabilities relating to the sale” and remit the amount owed to Irish water within 20 days of the sale. Irish Water will then provide the vendor’s solicitor with a receipt in relation to the amount remitted to it. It is provided in Section 48.3A (10) that Irish Water shall provide certificates of discharge, statements and receipts referred to the solicitor “without undue delay”.
Arising out of this amendment to The Water Services Act 2014, certificates of discharge and statements of account are now added to the list of documents to be provided by a vendor when thinking about putting your property up for sale. This long list of additional documents includes; certificates of discharge/exemption from NPPR, certificate of discharge in relation to the Household Charge, up-to-date Local Property Tax print-outs showing nil balances and confirmation of the property being registered in the correct LPT band, certificates of registration for septic tanks and now this new requirement for proof of payment of water rates.
Accordingly, it is now necessary when contemplating the sale of your property that water charges are paid in full before closing the sale. If the water charges are not paid, the solicitor dealing with the sale will have to discharge any arrears owed directly to Irish Water out of the sale proceeds.
The onus is on the owner of the property to provide to his or her solicitor a certificate/statement from Irish Water confirming that all water charges are paid. This could prove difficult if the property is rented as it is the occupier of the property, the tenant, who is responsible for this utility. If the owner fails to do this, the solicitor must contact Irish Water directly and request the information and certificate directly from Irish Water. If Irish Water then confirms that water charges are outstanding and owed, it will then become the obligation of that solicitor to withhold the arrears from the proceeds of sale and pay it to Irish Water within 20 working days of completing the sale.
The payment to Irish Water by the solicitor is out of the net proceeds of sale, after paying the mortgage and any other liabilities relating to the sale. So, for example, if the outstanding mortgage exceeds the sale price the full sale proceeds will be paid to the bank and there will be nothing left for Irish Water.
TOP TIP: If you are planning on selling your property, arranging this documentation early, will save unnecessary delays!