Vol. 426 No. 6
79 Miss Coughlan asked the Minister for Finance if he will amend section 496 of the Income Tax Act, 1967 to allow full mortgage interest relief on a farm residence and to discontinue apportioning between residence and farm; and if he will make a statement on the matter.
Relief for interest on a "qualifying loan" within the meaning of section 21, Finance Act, 1982, commonly known as mortgage interest relief, is restricted to the lesser of 80 per cent of the interest paid, or £1,600 for a single person, £3,200 for a married couple and £2,320 for a widowed person. These restrictions also apply to interest relief on qualifying loans taken out on farm residences.
It is presumed that, in the second part of the question, the Deputy is referring to a situation involving part business and part personal use of the farm residence. Where interest is paid in respect of a farm residence, the portion of the interest which is wholly and exclusively laid out for the purposes of the trade is allowed as a deduction in full in computing the profits of the trade. However, the portion of the interest which is in respect of personal use of the farm residence is restricted in the manner described in the previous paragraph.
Proposals for any change in mortgage relief are a matter for the budget.
