mortgage interest relief

L

legallady

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I was wondering if someone can help me with this. I am a first time buyer and I will be making my first mortgage repayment next month. I just want to know how much mortgage interest relief I will be entitled to. I will be paying interest only. My monthly repayments are going to be €1585 at a rate of 4.6%. I am single. How much am I entitled to? It completely confuses me!
thanks in advance!
 
As far as I know it's a max of 133 per month. You have to have filled in a TRS1 form that the bank would have sent you (think you can do it online also at revenue.ie). The relief is given automatically by the bank so you're payments will be reduced by that amount each month for 7 years.
 
legallady said:
I am a first time buyer

...

I will be paying interest only. My monthly repayments are going to be €1585

...

How much am I entitled to?
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Since you will be paying c. €20K interest p.a. you qualify for the maximum "FTB/first 7 years of mortgage" relief of €8K p.a. @ 20% = €1,600 p.a. or €133.33 p.m. which will be deducted at source from your mortgage repayments once you apply and get the tax credit. You may be entitled to a full year of tax relief even though your mortgage only started now in which case relief will be backdated (e.g. €1,600 instead of just September-December or 4 months x €133.33).
 
thanks to you both.
clubman, how would I find out if I am entitled to the full year relief?
 
How does the back-dated thing work Clubman? I mean in what cases would you be entitled to this? Just wondering as I'll be starting to pay a mortgage this month also. Thanks
 
I think that if you start your mortgage mid year then you get a full year of relief and they backdate it via the lender so you may have to contact them to see how they apply it (as opposed to the ongoing normal monthly relief) subsequently. However I could be totally wrong about the full year but I seem to recall something about this in the past. If in doubt contact Revenue and ask them.
 
You are wrong - they will only backdate to when the mortgage repayments started and the backdated pay will be presented as a credit on your mortgage account.
 
Information on TRS is available at [broken link removed]


While on this subject, what I'd like to figure out is if I have a low loan to value on my house (say a mortgage of around 20%) will I be able to get the same level of interest relief that I would if I have a large mortgage?

I'm trying to figure out whether I should pay off a lump sum on my mortgage.
 
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TravisT said:
While on this subject, what I'd like to figure out is if I have a low loan to value on my house (say a mortgage of around 20%) will I be able to get the same level of interest relief that I would if I have a large mortgage?
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It all depends on your annual interest bill. You can estimate this using Karl Jeacle's mortgage calculator. For an FTB in the first 7 years if you are paying €8K+ interest p.a. then you maximise your relief otherwise you get relief on just the amount actually paid.
 
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