Mortgage interest rate measures

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Brendan Burgess

Brendan Burgess

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Mortgage interest relief​


I have decided to introduce a one-year Mortgage Interest Tax Relief for home owners with an outstanding mortgage balance on their primary dwelling house of between €80,000 and €500,000 as of 31 December 2022.

Relief will be available in respect of the increased interest paid on the mortgage in the calendar year 2023 as compared with the amount paid in 2022, at the standard rate of 20% income tax. The relief will be capped at €1,250 per property.

Approximately 165,000 mortgage holders will benefit from this measure with an estimated cost of €125 million.

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My example

€200k mortgage . Rate up by 4% .

Total increase in interest €8000

Tax relief at 20% = €1,600

Capped at €1,250
 
Brendan Burgess said:
My example

€200k mortgage . Rate up by 4% .

Total increase in interest €8000

Tax relief at 20% = €1,600

Capped at €1,250
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Hi Brendan,

How do you think will this be processed?

Will impacted Mortgage Holders need to obtain statements from their Provider and submit them to Revenue via ROS?

Thanks

R
 
Dodger30 said:
Hi Brendan,

How do you think will this be processed?

Will impacted Mortgage Holders need to obtain statements from their Provider and submit them to Revenue via ROS?

Thanks

R
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According to the Irish Independent yes that seems to be the process:

Homeowners will be able to apply for the tax relief through the Revenue Online System and will be required to upload mortgage statements for the last two years. The relief is not available to commercial properties and mortgage holders who took out further debt over the last two years will not be eligible for the scheme.

www.independent.ie

Budget 2024: Childcare fees to be cut by 25pc, Mortgage relief for 160,000 and renters credit to increase

Childcare fees will be cut by 25pc in Budget 2024, the Irish Independent understands.
www.independent.ie www.independent.ie
 
Bobbyg said:
So no relief for anyone on a fixed rate in 2022 & 2023.
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With the way ECB rates and banks leaving the lrish market I am sure many have fixed their mortgages. Assume many will be finishing fixed rate in 2024. Sounds like very few will be applying for this.
 
Here are the recent rate increases

Average ECB rates have increased by 3.5% from 2022 to 2023

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So an increase of 3.3% between the years

So a person on an ECB +1% tracker with €100k will see their interest bill rise from
€1.5k to €5k
They will get 20% of €3.5k increase or €700

How on earth can it be justified giving €700 to someone with just €5k a year housing costs?

Someone whose €200k vulture fund mortgage has risen by 5% will be paying an extra €10,000 and will get €1,250.
 

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Look at it another way

Someone with a vulture fund mortgage of €200k @9% is paying €18k a year now, and will get €1,250

Someone on a tracker of €100k is paying about €6,000 will get €600.
 
Brendan Burgess said:
Look at it another way

Someone with a vulture fund mortgage of €200k @9% is paying €18k a year now, and will get €1,250

Someone on a tracker of €100k is paying about €6,000 will get €600.
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As I said on another thread, the government should be forcing the vulture funds to give people a choice of interest rates. In the absence of this, some relief should be granted (just giving profits to the funds).

No reason for people on trackers to get relief. They can fix at any time but chose not to. They have chosen to be on a variable rate; you benefit when rates are low, it costs you when rates are high. The government shouldn't subsidise them.
 
Showmethemoney said:
This also seems unfair to those people that used their initiative and fixed their mortgages when they saw the rates were going to sky rocket. They are going to get nothing.
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Is this strictly true? If I had tracker up to the end of last year and then moved to fixed rate I likely have more interest paid in 2023.
I don't see any mention of the mortgage type so I assume this would be applicable.
 
Purple said:
If you buy now you don't get any interest relief but if you've benefitted from years of low rates then you do. That hardly seems fair.
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Steven Barrett said:
No reason for people on trackers to get relief. They can fix at any time but chose not to. They have chosen to be on a variable rate; you benefit when rates are low, it costs you when rates are high. The government shouldn't subsidise them.
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I will be doing Prime Time at about 10 pm. Consider yourselves plagiarised.

Brendan
 
Pearse on it now

Mortgage Prisoners whose sale was facilitated by the two ministers.

SF had a plan.

And for months, the government opposed it. Including the Minister for Finance.

In 2016, you proposed 100% relief when ECB rtaes were at zero. Now you want it to be 20%

You are locking out tens of thousands of mortgage holders for no reason.

Tracker mortgage holders with balances of less than €80k will get nothing. The increases could cost them €2,000 more. And you are doing nothing.

This is a good example of the government taking a good idea from Sinn Féin and then mess it up.

You have made the u turn. Now get it right.
 
Steven Barrett said:
As I said on another thread, the government should be forcing the vulture funds to give people a choice of interest rates. In the absence of this, some relief should be granted (just giving profits to the funds).

No reason for people on trackers to get relief. They can fix at any time but chose not to. They have chosen to be on a variable rate; you benefit when rates are low, it costs you when rates are high. The government shouldn't subsidise them.
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To add to that, in my own case, I was able to fix my rate with KBC before they exited and will get my tracker back after the fixed term is up.
I won't get any relief as my mortgage balance is lower than 80k. I had low mortgage payments for years, so I don't feel aggrieved that I don't get any benefit from this measure, as I had a benefit for years with low rates.
 
Steven Barrett said:
No reason for people on trackers to get relief. They can fix at any time but chose not to. They have chosen to be on a variable rate; you benefit when rates are low, it costs you when rates are high. The government shouldn't subsidise them.
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I have a tracker mortgage and I fully agree. I have taken my changes and it's worked out really well except for the past 12 months or so. Over the life of the mortgage it's pennies really.
 
Me too - I decided - based on advice here a few months back not to fix my tracker but to whack up my payments significantly by 2.5 times (and divert money I was going to save/invest)- in order to pay it off early, as I can afford to do so and in order to finish it out .It looks like I am getting an unexpected bonus for this decision.
 
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