Wednesday, 23 October 2013

Questions (87)

Pearse Doherty

Question:

87. Deputy Pearse Doherty asked the Minister for Finance the target number of jobs and levels of investment generated by the home renovation incentive for each year up to and including 2016. [45290/13]

View answer

Written answers (Question to Finance)

As the Deputy is aware, I announced the Home Renovation Incentive in the recent Budget. This scheme will run from 1 January 2014 to 31 December 2015 and provides for tax relief for homeowners by way of a tax credit at 13.5% of qualifying expenditure incurred on repair, renovation or improvement work carried out on a principal private residence. Qualifying expenditure is expenditure subject to the 13.5% VAT rate. The work must cost a minimum of €5,000 (exclusive of VAT) which would attract a credit of €675. Where the cost of the work exceeds €30,000 (exclusive of VAT) a maximum credit of €4,050 will apply. The credit is payable over the two years following the year in which the work is carried out. The work must commence on or after 1 January 2014 and be carried out during 2014 or 2015.

Homeowners must be Local Property Tax compliant in order to qualify under the Incentive, while building contractors must be tax compliant in order to carry out works. The scheme will be administered through Revenue's online systems. Contractors will be required to inform Revenue in advance of details of works to be carried and will also be required to notify Revenue in relation to any payments received in respect of the works. Homeowners will be able to view the information provided to Revenue by the contractor through the Revenue electronic systems and will also claim the relief through those systems.

It is not possible to say how many jobs will be created as a result of this incentive, as numbers will depend on the level of take-up. It is estimated that this incentive will cost approximately €62 million in a full year. This cost equates to an overall spend in the construction sector of approximately €459.3 million.