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First Time Buyers' (FTB) Relief

Relief from tax on savings for first time buyers toward the purchase or self-build of a home was introduced in Budget 2015.

Deposit Interest Retention Tax (DIRT)

DIRT is an amount of tax deducted at source from interest that is paid on money you save in certain financial institutions.

An application for a DIRT refund may apply when you purchase or self-build your first house or apartment to live in.

To avail of the refund the following conditions must be met:

  • You must be a first-time buyer of a house or apartment who purchases or self-builds a property between 14 October 2014 and 31 December 2017.
  • You must not have either individually or jointly, with another person, previously purchased or built a house or apartment.
  • If the property is self-built it must be suitable to live in immediately, and you must register the land in your name before 31 December 2017.
  • The property must be occupied as your principal private residence. A refund of DIRT is not available for properties bought for investment purposes.
  • You may not claim a refund of DIRT under both First Time Buyers' Relief (FTB) and the Help to Buy Incentive (HTB).

DIRT deducted in the 48 months prior to the purchase date is available for refund. This refund is limited to the DIRT paid on savings up to a maximum of:

  • 20% of the purchase price of the house or apartment
  • 20% of the completion value of the property for self builds.

Joint claims

Joint claims are permitted if you have bought or self-built the property with another first time purchaser.

You cannot claim if the land is registered under a third party.

How to calculate Deposit Interest Retention Tax (DIRT) relief

The DIRT relief due each year is calculated by using the following formula:

DIRT Paid on interest / 12 months x months applicable for that year

Examples 1, 2 and 3 below show how DIRT is calculated for each of three different cases.

  • Example 1

    Mary bought her first house on her own on 31 October 2014 for €200,000. The maximum savings on which relief is due is €40,000 (€200,000 @ 20%).

    During the four years before the purchase date, 1 November 2010 to 31 October 2014, Mary saved €30,000. She earned gross interest of €455 and paid €155 DIRT on gross interest.

    Mary is allowed a full refund of €155, as her savings are below the maximum of 20% of the purchase price.

  • Example 2

    Joint first-time buyers John and Louise completed the construction of their newly built home on 31 January 2015. It is suitable for immediate occupation.

    The completed value of the house is €300,000. The maximum savings on which relief is due is €60,000 (€300,000 @ 20%).

    During the four years before the completion date, 1 February 2011 to 31 January 2015 John saved €30,000. He received gross interest of €420 and paid €143 DIRT on the interest*.

    Louise saved €35,000. She received gross interest of €490 and paid €167 DIRT on the interest*.

    Their savings exceed the maximum of 20% of the completion value. They are only allowed a refund on the maximum savings allowable.

    *John: €60,000 / €65,000 x €143 = €132

    *Louise: €60,000 / €65,000 x €167 = €154.15

  • Example 3

    If your purchase or completion date is during the calendar year, you will need to do a pro-rata calculation.

    DIRT Paid on interest / 12 (months) x (months applicable for that year)

    David, a first-time buyer, buys an apartment on his own on 31 January 2017.

    YearAnnual StatementPeriod of StatementMonths ApplicablePeriods ApplicableDIRT Paid (€)DIRT Due (€)

    5

    2017

    01/01/2017 - 31/12/2017

    1

    01/01/2017 - 31/01/2017

    144

    12

    4

    2016

    01/01/2016 - 31/12/2016

    12

    01/01/2016 - 31/12/2016

    128

    128

    3

    2015

    01/01/2015 - 31/12/2015

    12

    		 01/01/2015

    110

    110

    2

    2014

    01/01/2014 - 31/12/2014

    12

    01/01/2014 - 31/12/2014

    98

    98

    1

    2013

    01/01/2013 - 31/12/2013

    11

    01/02/2013 - 31/12/2013

    84

    77

    The total amount of DIRT relief due to David is €425.

How to make a claim

To make a claim, you must register the property for Local Property Tax (LPT). Once registered, you log in to the LPT system and enter your Personal Public Service Number (PPSN) or Tax Reference Number, Unique Property ID and Secure PIN.

Once in the LPT system, click the ‘Claim DIRT FTB Refund’ to submit your application.

Published: 26 August 2020 Print this page

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