FIRST TIME BUYER'S REBATE AND PROPERTY TAX CHANGES
Help to Buy Scheme
Budget 2017 introduced a new scheme whereby first time buyers of new homes can get a tax rebate of up to 5% of purchase price. A rebate will be available for income tax paid over the 4 years prior to the purchase, up to a maximum of 5% of the purchase price up to €400,000. In other words, the rebate is capped at €20,000. Relief is available for new houses up to a value of €600,000 but no relief will be given for houses above this amount. The relief applies to houses purchased from 19 July 2016 until 2019.
The relief applies both to houses newly built by developers and one-off self builds.
The scheme is only available to those who are taking out a mortgage of least 80 per cent of the purchase price, or in the case of a self-build, 80 per cent of the valuation approved by the mortgage provider.
The relief applies both to houses newly built by developers and one-off self builds.
The scheme is only available to those who are taking out a mortgage of least 80 per cent of the purchase price, or in the case of a self-build, 80 per cent of the valuation approved by the mortgage provider.
Residential Landlords' Interest Deduction
Budget 2017 increased on a phased basis the interest deduction available to residential landlords. The deduction will increase form 75% to 80% in 2017 for new and existing mortgages and will increase by a further 5% each year afterwards until it reaches 100% of the interest paid.
The Living City Initiative
Budget 2017 extended the Living City Initiative - a measure designed to encourage the renovation of pre-1915 city centre properties - to include landlords. A restriction on the floor size of qualifying properties has also been removed.
Home Renovation Scheme
Budget 2017 extends the Home Renovation Incentive by two years to 2018.
The Incentive provides for tax relief by way of an Income Tax credit at 13.5% of qualifying expenditure on repair, renovation or improvement works carried out on a main home or rental property by qualifying Contractors.
Qualifying expenditure is expenditure subject to the 13.5% VAT rate.
The works must cost a minimum of €4,405 (before VAT) per property, which will attract a credit of €595 per property. Where the cost of the works exceeds €30,000 (before VAT) per property, a maximum credit of €4,050 per property will apply.
The credit is payable over the two years following the year in which the work is carried out and paid for. The first year for HRI tax credits is 2015 for Homeowners and 2016 for Landlords.
Homeowners or Landlords must be Local Property Tax and Household Charge compliant in order to qualify under the Incentive. Landlords must also have complied with the Private Residential Tenancies Board External link registration requirements. Contractors must be VAT and RCT registered and tax compliant in order to qualify to carry out works under the HRI.
The Incentive provides for tax relief by way of an Income Tax credit at 13.5% of qualifying expenditure on repair, renovation or improvement works carried out on a main home or rental property by qualifying Contractors.
Qualifying expenditure is expenditure subject to the 13.5% VAT rate.
The works must cost a minimum of €4,405 (before VAT) per property, which will attract a credit of €595 per property. Where the cost of the works exceeds €30,000 (before VAT) per property, a maximum credit of €4,050 per property will apply.
The credit is payable over the two years following the year in which the work is carried out and paid for. The first year for HRI tax credits is 2015 for Homeowners and 2016 for Landlords.
Homeowners or Landlords must be Local Property Tax and Household Charge compliant in order to qualify under the Incentive. Landlords must also have complied with the Private Residential Tenancies Board External link registration requirements. Contractors must be VAT and RCT registered and tax compliant in order to qualify to carry out works under the HRI.