The one-off Mortgage Interest Tax Credit was announced by the Minister for Finance for 2023 which has now been extended to include this year, 2024. It is expected to save homeowners an average of €800 per year.
This credit is for taxpayers who have made mortgage interest payments on their main home, subject to a number of conditions, and it can now be claimed on your tax return.
There are some basic criteria that you must meet before you are eligible to claim the Mortgage Interest Tax Credit. To check if you qualify see the conditions set out below.
For PAYE taxpayers you can claim your mortgage interest tax credit by logging into myAccount and select ‘You and your family’ in the ‘Tax Credits & Reliefs’ page. Click on the ‘mortgage interest tax credit’ and work through the claim, then submit your details.
Self-assessed tax payers must file a Form 11 on ROS and the claim for the mortgage interest tax credit can be found in the ‘credits and deductions’ section.
To make the claim you need to be able to provide the following information and documents.
Example:
Tom and Mary have an outstanding Mortgage (as of 31 Dec 2022) on their principle private residence of €300,000. According to their annual mortgage interest bank certs, the interest paid in 2022 was €5,000 and in 2023 it was €7,500. Therefore, the increase in interest is €2,500. Tax Credit available is €2,500 * 20% = €500
Tom and Mary are entitled to a Mortgage Interest Tax Credit of €500 for 2023 and will be repaid by Revenue on receipt of filing their tax return. If their mortgage interest in 2024 is above €5,000 they will be in a position to make another claim after the year end.
Given the conditions outlined above, properties used for commercial purposes would not qualify. It is worth noting that if you are availing of the Rent a Room scheme then your entitlement to mortgage interest relief should not be affected. The Rent a Room relief allows you to earn tax free income up to a threshold of €14,000 however the property must still be considered your main residence.
Remember, tax laws and interpretations can change, so it’s important to get the most current advice based on your specific circumstances. Understanding the system and insightful planning can make that financial difference for you and your family. So, when you’re ready to discuss your needs make sure to talk to our team of tax experts or your Dedicated Account Manager. Book a call here.
This article has been carefully prepared, but it has been written in general terms and should be seen as broad guidance only.
This article was written on the 07/10/2024
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