What is the Help to Buy Scheme?
The Help to Buy Scheme was introduced in July 2016 to help first-time buyers buy or self-build a new residential property. The Help to Buy Scheme allows first time buyers to claim a refund of income tax and DIRT paid over the previous 4 tax years and to use this refund as part of the deposit for the purchase of a newly built residential property.
What change has been introduced?
The July Jobs Stimulus Package increased the amount first time buyers can claim under the Help to Buy Scheme from 5% of the purchase price (up to a maximum of €20,000) to 10% of the purchase price (up to a maximum of €30,000). If the property is a self-build, the amount will be 10% (up to a maximum of €30,000) of the completion value of the property. First time buyers who sign a Contract for the purchase or a new house or apartment or make the first draw down of their mortgage in case of a self-build between 23 July 2020 and 31 December 2020 are eligible for this enhanced relief. At present, this increased limit will apply until the end of 2020 only and it remains to be seen if it will be extended further.
How to apply
Buyers who previously made a Help to Buy application may be in a position to available of the enhanced relief. If so, the original Help to Buy application should be cancelled and a new application for the increased relief should be made. Applications for the Help to Buy Scheme can be made through the Revenue's myAccount website if a PAYE employee or the Revenue ROS website if self-employed. Revenue will review the details provided and confirm if a buyer is eligible for the Help to Buy Scheme. An application number will issue to the buyer which must be furnished to the developer to allow the application to be linked to the claim for payment. Once a first time buyer qualifies the Revenue Commissioners will issue the rebate directly to the Contractor / Developer in the case of the purchase of a new property as part of the purchaser's contract deposit, or to the lending institution in the case of a new build.
Originally published by BHSM, October 2020
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