Many Irish taxpayers miss out on potential savings each year, simply because they aren't aware of the various tax reliefs and credits available to them. Staying informed and claiming tax entitlements can make a difference in your household finances.

Budget 2024 introduced specific reforms and reliefs and this article is your key to understanding and maximising their benefits.

Mortgage Interest Relief

In response to rising interest rates, Budget 2024 introduced a one-time mortgage interest tax relief. This is a targeted measure that mainly applies to tracker mortgage holders and those on variable rates who are compliant with Local Property Tax requirements, and had an outstanding mortgage balance of between €80,000 and €500,000 on their primary home on 31 December 2022.

Eligible individuals can claim 20% tax relief on the increased interest paid in 2023 compared to 2022, capped at €1,250. Additionally, you may also be eligble to claim the credit if you are paying the mortgage interest on a qualifying loan for the main private residence of your former or separated spouse; a dependent relative; or a dependent relative who is your spouse's widowed parent, or a relative who is unable to care for themselves due to old age or illness.

Mortgage holders who qualify for the relief can apply for their tax credit directly through their online account with Revenue, and will need to have their certificate of mortgage interest for 2022 and 2023, and confirmation of their mortgage balance on 31 December 2022. Revenue has undertaken to have the facility allowing homeowners to claim the tax relief up and running by the end of January.

Help to Buy Scheme

The Help to Buy (HTB) Scheme, which was introduced in 2017, was extended until 31 December 2025. The HTB is a tax refund initiative aimed at helping first time buyers purchase a newly-built house or apartment. It also applies to once-off self-build homes. You claim the lesser of €30,000; 10% of the market value of a new build property; 10% of the approved valuation of a self-build property; or the amount of income tax and DIRT you paid for the 4 years before the year you apply.

The scope of the HTB was expanded to include applicants for the Local Authority Affordable Purchase Scheme. The scheme facilitates first time buyers with modest incomes to buy new homes at reduced prices, with the Local Authority taking a percentage stake based on the discount. From 11 October 2023, applicants of the Scheme can now also apply for the HTB to fund their deposit amount.

Tax Relief for Landlords

Budget 2024 introduced a new tax relief for small landlords. The relief will be available against some rental income at the standard rate of 20% each year. It will be available from 2024 to 2027. Landlords can get 20% of €3,000 for 2024; €4,000 for 2025; €5,000 for 2026 and 2027.

To qualify, landlords must retain their property in the rental market for a four-year period, failing which the relief amount will be clawed back. This measure is designed to ensure sustained availabilty of rental properties, and promote a stable housing market.

Understanding and utilising the 2024 tax reforms and reliefs can have a positive impact on your financial well-being. Whether you are a homeowner looking benefit from mortgage interest relief, first time buyer navigating the Help to Buy Scheme, or landlord considering the new tax relief, staying informed is the to making the most of these opportunities.