Tuesday, 27 May 2014

Questions (112)

Michael McGrath


112. Deputy Michael McGrath asked the Minister for Finance if persons (details supplied) in County Tipperary are entitled to tax relief at source on mortgage interest in respect of the amount of their mortgage drawn down in 2012; and if he will make a statement on the matter. [22540/14]

View answer

Written answers (Question to Finance)

In order to qualify for mortgage interest relief (MIR), a loan must have been drawn down and used in the purchase, repair or development of an individual's principal private residence on or before 31 December 2012. On this basis, any funds drawn down on a date later than 31 December 2012, do not qualify for the relief. However, Section 9 of the 2013 Finance Act provides for extended entitlement beyond the 31 December deadline in circumstances where all of the required qualifying conditions are met.

 The qualifying conditions are:

- The loan must have been taken out between 1 January 2012 and 31 December 2012,

- A portion of the loan must have been used to purchase a site in 2012,

- The balance of the loan must be drawn down and used to construct a dwelling on that site in 2012 and 2013.

- Any necessary planning permission must have been in place prior to 31 December 2012.

Regarding the case to which the Deputy refers, Revenue has confirmed to me that the site in question was not purchased by the claimants during 2012, thereby 'disqualifying' the funds drawn down after 31 December 2012 from entitlement to MIR. Revenue has also confirmed to me that while the claimants are not entitled to MIR in respect of the portion of the loan drawn down after 31 December 2012, they are in receipt of MIR in respect of the portion of the loan drawn down in December 2012. This entitlement will continue up to 2017 as currently provided for under the legislation.