The cost-of-living crisis continues to ravage the funds of households in Ireland and has resulted in many people putting big purchases on hold - particularly those planning to get on to the property ladder.
If reaching your goal of being a homeowner is a mere stretch of €30,000 or less, the government has a scheme in place for first-time buyers that can get you there - and it has been extended until December 2024.
Getting mortgage approval in Ireland can be a stressful and sometimes tricky process, so the Help to Buy Scheme supports those wishing to purchase a newly-built house or apartment as their first home.
It also applies to once-off self-build homes and is only aimed at properties that cost €500,000 or less.
The Help To Buy Scheme was increased in July 2020 under the Enhanced Help to Buy Scheme. Although this was due to end in December 2022, the government announced in Budget 2023 that it will be extended until the end of 2024.
The scheme gives a refund of the income tax and Deposit Interest Retention Tax (DIRT) you have paid in Ireland over the previous four tax years - and the best part is anyone who is a PAYE worker is eligible - there is no means test.
So if you are a first-time buyer who has bought or plans to buy (or self-build) a new residential property between July 2016 and 31 December 2024, you may be entitled to claim a refund of income tax and DIRT that you paid over the previous four tax years.
You can claim relief on the lesser of:
- €30,000
- 10 per cent of the purchase price of a new build property
- 10 per cent of the approved valuation of a self-build property
- The amount of income tax and DIRT you paid for the previous 4 years
The maximum payment is €30,000 per qualifying property under the enhanced relief and this cap applies regardless of how many people enter into a contract to purchase the property.
A few contingencies must be met such as, if you are buying (or self-building) the property with someone else, they must also be a first-time buyer.
You will not qualify if you have previously bought or built a property, either individually or jointly with anyone else, even if you are now separated or divorced from that person.
You will also not qualify if you have owned a home abroad.
You must also take out a mortgage of at least 70 per cent of:
- The purchase price of the property if you are buying your newly built home
- The valuation approved by the mortgage provider, if you are building your home
- Other rules also insist you must live in the property for five years from the date that it is habitable
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