Dáil Éireann Debate, Tuesday - 4 November 2014
319. Deputy Brendan Griffin asked the Minister for Finance his views on increasing the amount of home renovation incentive available to a house owner where a house is being renovated and made available to a local authority as rental accommodation; and if he will make a statement on the matter. [41612/14]
View answerAs the Deputy is aware, the Home Renovation Incentive (HRI) came into operation on 25 October 2013 and will run until 31 December 2015. The incentive provides 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 (inclusive of VAT) which would attract a credit of €595. 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 take-up of the HRI has been very successful to date, with just under 9,300 homes registered on the online system, representing almost €190 million worth of works involving some 3,000 contractors. It is clear that the incentive is generating employment in the tax compliant construction sector and increasing sales in building supplies, hardware and related businesses.
In the context of Budget 2015, I did consider increasing the amount of relief provided, but I decided that it would be better to extend the HRI to the owners of rental properties who are liable to income tax. This will support legitimate operators in the rental and construction sectors and help to upgrade the quality of private rental stock, particularly at the lower end. This change has taken effect since Budget night and will run until the end of 2015.
