Revised help-to-buy scheme opens for applications

Relief increased last month in stimulus plan to €30,000 or 10% of the property value

The expanded help-to-buy scheme, intended to assist first-time buyers in getting on the property ladder, has opened for applications.

The incentive scheme, announced in the €7 billion stimulus plan late last month, allows first-time buyers purchasing a newly built home – or building one themselves – to claim back up to €30,000 in income tax and Dirt paid on bank deposit interest over the four years prior to the year they buy their home.

This marks a substantial increase on the previous rules that enabled home buyers to claim back a maximum of €20,000.

In addition, the enhanced relief sees a doubling of the amount of the purchase price that the scheme covers. This means buyers can now claim up to 10 per cent of the cost of a home priced up to €300,000, and €30,000 on more expensive properties up to a maximum value of €500,000.


Online applications

First-time buyers eligible for the scheme can now make applications through Revenue’s online service.

Buyers who signed a contract for the purchase of a new house, or who drew down the first tranche of their mortgage in the case of a self-build, prior to July 23rd, will not satisfy the requirements of the enhanced scheme, Revenue said.

Those who have done so since July 23rd can request a Revenue review of their claim to see if they can secure the higher amount.

People who have applied but who are not as advanced in the process can cancel those applications and apply under the enhanced scheme.

Recent figures show that more than 40 per cent of the first-time buyers who availed of the original help-to-buy scheme already had the necessary deposit to secure a mortgage. It was also recently revealed that more than half of scheme applicants never made it to the claim stage.

The scheme’s primary aim was to stimulate the supply of more affordable homes within a certain price range, and assist first-time buyers in getting a deposit. However, critics maintain it disproportionately benefits households at the higher end of the income distribution, and supports high prices.

Charlie Taylor

Charlie Taylor

Charlie Taylor is a former Irish Times business journalist