TRS query - tax year basis?

C

Celt07

Registered User
Messages
50
I just have a query in relation to TRS. My repayments are lower than expected since the TRS was applied. I had expected to receive a credit of €133 per month (single & FTB) but it is working out at much more than that. My mortgage started in August but I'm just wondering if I get credit for the €8,000 ceiling for the entire tax year? Just trying to figure out how it has been calculated. Thanks.
 
depends on how much interest you are paying annually. €8,000 is the ceiling for the whole tax year but you benefit at the %20 rate.
 
Sorry if there wasn't enough detail in my earlier post. I will pay approx €6k of interest this year ie from August 2007 to December 2007 on a fixed rate mortgage. My understanding was that I would receive a tax credit of €133 per month ie (€8k x 20%)/12. Instead of that I appear to be getting relief for the entire amount of interest estimated for the year ie (€6k x 20%). Since my repayments started in Sept and I only have four repayments this year, the tax credit is quite significant each month and means my repayments at the moment are a lot lower than I expected. I have tried to calculate it but it is not working out exactly for me, that's why I wondered if anyone could confirm how they calculate it. Presumably from 1st Jan 2008, the tax relief will revert to €133 per month plus the additional €33 per month credit promised. Thanks.
 
Celt07 said:
Instead of that I appear to be getting relief for the entire amount of interest estimated for the year ie (€6k x 20%).
Click to expand...
Sounds correct to me - in 2007 you will pay less than the €8K cap on relief so you get relief on the full amount that you actually pay (€6K x 20%) = €1,200 which, over 5 months means €240 p.m. for the moment. If, next year, you pay c. (€6K / 5) * 12 = €14,400 interest then you will get relief on just €8K.
Presumably from 1st Jan 2008, the tax relief will revert to €133 per month plus the additional €33 per month credit promised. Thanks.
Click to expand...
Yes but I don't know what the extra €33 is. Is this some Budget 2008 promise to increase relief or something?
 
Thanks for that. It was a bit of a an unexpected bonus especially since the first months after buying a new house are always fairly expensive. As for the €33, before the election FF promised to increase the ceiling to €10,000 from €8,000. They did stick to their promise of stamp duty change for FTBs so hopefully they don't forget about this one!
 
You must log in or register to reply here.
Back
Top