Up to date position regarding the Help-to-buy scheme per reply to my Parliamentary Question in Dáil Éireann
For Written Answer on : 22/04/2021
Question Number(s): 23 Question Reference(s): 21071/21
Asked by: Brendan Smith T.D.
To ask the Minister for Finance if the timeframe for applicants to meet the conditions for the help-to-buy scheme will be extended by the number of weeks that construction was closed down; and if he will make a statement on the matter.
The Help to Buy (HTB) incentive is a scheme to assist first-time purchasers with obtaining the deposit they need to buy or build a new house or apartment. The scheme gives a refund on Income Tax and Deposit Interest Retention Tax (DIRT) paid in the State over the previous four years, subject to limits outlined in the legislation. Section 477C of the Taxes Consolidation Act (TCA) 1997 outlines the definitions and conditions that apply to the scheme.
In summary, the process for a first-time buyer to claim HTB involves two stages, application stage and claim stage. At the application stage, the claimant notifies Revenue of his/her intention to make a HTB claim and checks are carried out to ensure the applicant satisfies certain conditions of the scheme. Once confirmed Revenue notifies the applicant with the potential HTB refund available.
An application for HTB will remain valid until one or more of the following occurs:
(a) if it is discovered that the individual did not satisfy a condition of HTB,
(b) an individual’s tax clearance is rescinded, or
(c) 31 December (in the tax year in which the application is made).
In respect to point (c) above, for example where an application is made during the period 1 October to 31 December 2021, and a claim is made on foot of such an application in the period 1 January to 31 March 2022, the claim will be deemed to have been made in 2021.
With regard to the claim stage, Section 477C(3) TCA provides that a first time purchaser may make a claim for a HTB refund following the signing of a contract to purchase a home or, in the case of a self-build, following the drawdown of the first tranche of the relevant mortgage.
Revenue Tax and Duty Manual Part 15-01-46 outlines further guidance on the conditions and operation of the HTB scheme.
More generally, the future of the HTB scheme, beyond its current sunset date of 31 December 2021, is a matter that will fall to be considered in the context of Budget 2022 and the subsequent Finance Bill.