Revenue clarification of the position regarding Mortgage Interest Relief
The Minister for Finance in his supplementary Budget of 7 April announced that mortgage holders will, from 1 May 2009, only receive mortgage interest relief through the tax relief at source system for the first seven years of the mortgage.
For those affected by the Budget change, the maximum relief involved in the case of a married couple is €75 a month, or €37.50 for a single person and in many cases it would beless than these amounts.
Revenue has been working with lenders in giving effect to those changes since the announcement.
First Time Buyers who are within the first seven years of their mortgage will continue to get the relief automatically until the end of the 7th year of their mortgage.
Non-First Time Buyers are only entitled to the relief after 1 May where they are in the first seven years of the mortgage on a qualifying loan. Revenue has been working with the lenders to identify those accounts where there will be an entitlement to mortgage relief under the new rule. Until that entitlement can be established mortgage interest relief is not being paid from 1 May.
Where, based on the information provided by lenders, an entitlement to relief is established, tax relief at source will be reactivated automatically by Revenue in June. Any arrears of relief will be credited to their accounts without the need for any action on the part of the account holder. Where an entitlement to relief cannot be established then Revenue will be writing to those mortgage holders in the coming weeks. Where such account holders provide information to Revenue that establishes their entitlement to mortgage relief, tax relief at source will then be reactivated by Revenue. Again any arrears of relief will be credited to the account.
Revenue understands from its discussion with the lenders over the last few weeks that the foregoing arrangements should not have an adverse impact on the operation of the accounts of mortgage holders. However the precise arrangements in any case is a matter between the individual account holder and his/her lender.
Comprehensive information is now available on the Revenue website.
[Ends: 30/04/2009]