Buying a House
- Claiming Relief - Frequently Asked Questions (FAQs)
- Home Improvement Loans - FAQs
- Help to Buy (HTB) Incentive
- Useful Information
Other Frequently Asked Questions
- Do I need to tell the tax office if I buy a house?
- Can I claim tax relief on my mortgage?
- Must the house be situated in the State?
- What is a sole or main residence?
- Does residence only mean a house?
How much tax relief will I get?
Tax relief is granted on the amount of the interest paid, subject to the overall limits please refer to Tax Relief at Source (TRS) for Mortgage Interest Relief.
How can I claim the relief?
From 1 January 2002, tax relief for home mortgage interest is no longer given through the tax system but is instead granted at source. This means that your mortgage lender gives you the benefit of the tax relief element on the mortgage interest on behalf of the Revenue Commissioners.
Your mortgage repayment is reduced by the amount of the tax relief. Your lender in turn claims this amount from Revenue. Any future adjustments in the tax relief (for example, arising from changes in interest rates) will be made automatically by the lender on behalf of Revenue. It is not necessary to claim mortgage interest relief in the annual tax return, and it no longer appears on your Tax Credit Certificate. Borrowers who are taking out new mortgages or who wish to claim for relief due for previous years must apply online.
To help with the mortgage repayments, I intend letting part of my house. What tax relief can I claim against my personal income tax and against the rental income?
In this situation, part of the mortgage interest may be claimed as a normal interest credit against your personal income tax. However, the balance of the interest may not be claimed as a rental deduction. The mortgage interest applicable to the let part of the house will be determined on a just and reasonable basis. For example, the apportionment of the interest may be by reference to the number of rooms let. For more information please see IT70 - A Revenue Guide to Rental Income.
Home Improvement Loans - FAQs
Can I claim tax relief for interest paid on a loan for home improvements?
Yes. You can claim tax relief for interest paid on a loan used by you, on or before 31 December 2012, to purchase, repair, develop or improve your sole or main residence or to pay off another loan (or loans) used for that purpose.
Relief can also be claimed in respect of interest paid on a loan to repair, develop or improve a home but only where loan approval was in place in 2012 and part of the loan was used in 2012 and the balance used in 2013 on such repair, development or improvement.
What can the loan be used for?
The loan can be used for most work done on your sole or main residence except for money spent on furniture or removable fittings (e.g. light fittings, curtains, carpets etc.). Examples of what the loan may be used for are:
- Extensions, purchase/construction of garage, garden shed, greenhouse etc.
- Construction of driveway, path etc.
- Conversions, painting and decorating
- Installing central heating
- Rewiring or replumbing (including bathroom suites)
- Replacing or installing windows
- Purchase and/or installation of burglar/fire alarms
- Purchase and installation of bedroom and kitchen units which are affixed to and become part of the building
- Treatment for damp, dry rot, woodworm etc.
- Landscaping gardens (including garden walls)
- Contributions to group water and sewerage schemes.
Other Frequently Asked Questions
Do I need to tell the tax office if I buy a house?
Yes - you should inform the tax office as soon as possible so that all correspondence can be sent to your new address.
Can I claim tax relief on my mortgage?
Loans taken out after 31 December 2012 do not qualify for mortgage interest relief.
Mortgage interest relief is available for the tax years 2013 to 2017, in respect of;
- interest paid on a loan taken out in 2013 to construct a home on a site, but only where such site was bought by way of a loan taken out in 2012, and
- interest paid on a loan to repair, develop or improve a home but only where loan approval was in place in 2012 and part of the loan was used in 2012 and the balance used in 2013 on such repair, development or improvement.
Before relief will be granted, any necessary planning permission must have been in place on or before 31 December 2012.
Must the house be situated in the State?
Relief is available if the house is situated in the State, Northern Ireland or Great Britain and is used as your sole or main residence. Also, with effect from 1 January 2015 the relief extends to homes situated in an EEA State, but only where the house was purchased prior to 31 December 2012.
What is a sole or main residence?
A sole or main residence is the residence which is your home for the greater part of the time. It does not have to be owned by you e.g. your parents' residence may also be your sole or main residence, if you normally live there.
Does residence only mean a house?
No. It also includes:
- A flat
- Any garden or grounds of an ornamental nature which are used along with the house or flat
- A Mobile Home/Caravan - provided it:
- Is on a permanent site
- Is of a reasonable size to fulfill the requirements of use as a permanent residence
- Has electricity and other services supplied to it
- Is immobilised (i.e. wheels removed and mounted on blocks).
Local Property Tax - Sale / transfer of ownership of residential property
Stamp Duty - Residential property and non-residential property
Updated: October 2016