Are You Missing Out on €1,250? Thousands of Homeowners Haven’t Claimed Mortgage Tax Relief
A significant number of homeowners are missing out on valuable tax relief designed to help them cope with soaring mortgage interest rates. Over 180,000 individuals could be missing out on up to €1,250 each, representing a collective potential loss of €120 million.
The Mortgage Interest Relief Scheme
Introduced in October 2023 by then-Minister for Finance Michael McGrath, this temporary tax credit was aimed at homeowners who faced the brunt of six interest rate hikes from the European Central Bank (ECB) throughout 2023. These hikes significantly increased monthly repayments for many homeowners, exceeding an extra €4,000 per year by the end of 2023 compared to 2022.
The initiative was meant to benefit a wide range of mortgage holders, including those with tracker mortgages, standard variable rates, and loans managed by so-called “vulture funds.”
Slow Take-Up Raises Concerns
While the relief measure was met with positive feedback upon its announcement, the rate of applications has been alarmingly low. By the end of last month, only 26,859 individuals had sought a tax refund from Revenue, representing just 12% of those the Department of Finance anticipated would qualify. This number has plateaued in recent months, suggesting a stagnation in claims.
A Potential Windfall Still Available
According to Revenue figures, those who have successfully claimed the credit have received an average rebate of €670. If the remaining 181,000 eligible individuals applied, the total amount reclaimed would exceed €120 million.
It’s important to note that these figures are subject to change as information regarding claims made by self-assessed taxpayers is yet to be released. These taxpayers had until the end of last month (or November 14th for online submissions) to submit their 2023 tax returns.
Why the Low Take-Up?**
Recent surveys indicate a lack of awareness surrounding the mortgage tax credit might be a contributing factor. A Taxback.com survey revealed that 700 out of 1,400 respondents were unaware of the program’s existence.
Additionally, some criticize the application process as overly complicated, requiring individuals to file a tax return with Revenue, a process unfamiliar to most PAYE workers.
How to Claim Your Mortgage Tax Relief**
The mortgage interest relief scheme is available to taxpayers whose primary residence had an outstanding mortgage balance between €80,000 and €500,000 on December 31st, 2022. The credit is calculated at 20% of the increase in your mortgage interest bill in 2023 compared to 2022, up to a maximum of €1,250.
The good news is, although initially a one-off measure, it has been extended to 2024.
For those who missed the deadline, there’s still time! The limit on claiming tax refunds for both PAYE and self-assessed individuals is four years.
Don’t Miss Out!**
Take action today and explore if you’re eligible for this valuable tax relief. Visit the Revenue website or consult with a tax professional to learn more and submit your claim.