Mortgage Interest Relief (Tax Relief at Source - TRS)
What is a qualifying mortgage loan?
A qualifying mortgage loan is a loan secured by the mortgage of freehold or leasehold estate, or interest in a principal private residence.
A qualifying mortgage loan may be:
- a new mortgage
- a top-up loan used to develop or improve the home
- a separate home loan used to develop or improve the home
- a re-mortgage or a consolidation of existing loans.
Examples of qualifying mortgage loans
Qualifying mortgage loans are loans used for the purpose of:
- purchasing your home
- extensions or purchasing or constructing a
- garden shed
- swimming pool
- tennis court
- constructing a driveway or path
- installing central heating
- rewiring and plumbing (including bathroom suites)
- replacing windows and double glazing
- purchasing and installing bedroom and kitchen units which are affixed to and become part of the building
- purchasing and installing burglar or fire alarms
- the installation and treatment for damp, dry rot and woodworm
- landscaping gardens (including garden walls)
- payments to group water and sewerage schemes
- purchasing another person's part interest in the home
- legal fees and other fees related to purchasing or developing your home
- Stamp Duty on the purchase of your home.
How is the relief granted on a qualifying mortgage loan?
Your lender grants tax relief for a qualifying mortgage loan directly through the Tax Relief at Source (TRS) scheme. The TRS system applies to secured home loans – these are loans secured by the mortgage of freehold or leasehold estate or interest in a principal private residence. The lender gives the relief by either reducing your monthly mortgage payment or as a credit back into your mortgage funding account.
How is the relief granted on other qualifying home loans?
You can claim tax relief through your Revenue Office for a home loan that is:
- not secured on the title deeds of the home
- secured on a property other than your home.
The relief, in this instance, is paid through the tax system by:
- a review at the end of the tax year or
- a relief shown on the certificate of tax credits during the tax year.
Next: Do you qualify for Mortgage Interest Relief?