Written Answers Nos. 269-280
269. Deputy Sean Fleming asked the Minister for Finance if he will extend the tax relief scheme ceiling rate of €20,000 and €10,000, respectively, for all families who purchased houses in the boom period beyond the seven years up to 2017 as per the 30% rate, as not to do so will cause more families to fall into mortgage difficulties; and if he will make a statement on the matter. [11712/15]
View answer270. Deputy Sean Fleming asked the Minister for Finance if he will provide a tax relief scheme for persons who took out mortgages in November or December of a current year, where the first year would run to November or December of the following year, hence avoiding the situation whereby householders who take out mortgages at the end of the year lose the whole year in tax relief at source payments; and if he will make a statement on the matter. [11713/15]
View answer274. Deputy Tom Fleming asked the Minister for Finance if he will address the tax relief scheme for first time buyers who purchased their houses in the boom period from 2004 to 2008, in order to extend the ceiling rate of €20,000 to the year 2017 in line with the 30% rate, as failure to do this will result in more families losing their homes with a drop in the tax relief scheme of over €200 per month for many families; and if he will make a statement on the matter. [11842/15]
View answer275. Deputy Tom Fleming asked the Minister for Finance his views on a matter (details supplied) regarding the tax relief scheme payment for persons who built their family home at the end of 2004; and if he will make a statement on the matter. [11869/15]
View answerI propose to take Questions Nos. 269, 270, 274 and 275 together.
The position is that in Finance Act 2010, mortgage interest relief was extended up to end of 2017 for those whose entitlement to relief was due to end in 2010 or after. Therefore, tax relief will continue to be available in respect of interest paid by an individual on qualifying home loans taken out on or after 1 January 2004 and on or before 31 December 2012, regardless of whether they are considered first-time buyers or non-first-time buyers.
This Government is committed to helping address the particular problems faced by those that bought homes at the height of the property boom between 2004 and 2008. In this regard, in Budget 2012, I fulfilled the commitment in the Programme for Government to increase the rate of mortgage interest relief to 30 per cent for first time buyers who took out their first mortgage in that period. This was the period during which house prices peaked.
A mortgage holder will qualify for the increased rate if they made their first mortgage interest payment in the period 2004 to 2008 or if they drew down their mortgage in that period. In addition, the increased rate of tax relief for first time buyers who took out their first mortgage in that period will continue up to and including the 2017 tax year.
Individuals that purchased their home within this specified date range are entitled to a 30% rate of relief on interest paid up to an interest ceiling of €20,000 if married/widowed and €10,000 if single, for the first seven years. Thereafter, the ceiling reduces for the remaining years to a maximum of €6,000 if married/widowed and €3,000 if single. The ceilings reduce in recognition of the fact that interest makes up a larger proportion of the mortgage payable in the earlier years of the mortgage period, and that capital makes up a larger proportion of the mortgage payable thereafter.
Regarding the Deputy's question concerning the month during which the mortgage is first taken out, Mortgage Interest Relief is granted up to the full appropriate ceiling for that year, and each subsequent year up to 2017, regardless of which month the mortgage payments actually commence.
Regarding the Deputy's question concerning individuals who built their family home at the end of 2004, it is not clear from the question which particular circumstance the Deputy has concerns about. However, I would point out that the look back period for tax relief purposes in respect of the tax years 2004 and 2005 has now passed.
Regarding the issue of mortgage difficulties, the latest publication from my Department shows the continued improvement in Principal Dwelling House (PDH) mortgage arrears since August 2013. The number of mortgage accounts in arrears of greater than 90 days has declined by almost 25%, while those accounts in arrears of less than 90 days fell by almost 28%. Total PDH mortgage accounts in arrears show a decline of almost 26% over the same time period from 118,438 in September 2013 to 87,818 at end January 2015.
Total Mortgage accounts that have been restructured now stand at 106,275. The number of mortgage accounts in arrears of greater than 90 days continues to fall, decreasing by 1,398 accounts to 60,868. Engagement between consumers and lenders has resulted in an increase of 2,764 permanent mortgage restructures in January.
Given that the next Budget is almost seven months away it would be inappropriate for me to become involved in speculation on this matter. However, I will say that as part of the normal budgetary preparations, my officials continue to monitor the situation and will be examining potential options for changes to the tax system for my consideration as part of the overall Budget package. However, given that Mortgage Interest Relief has effectively been abolished since 2013 for new mortgages, I am not predisposed to reopen it to further amendment to provide additional benefits to existing claimants.
271. Deputy Billy Kelleher asked the Minister for Finance the number of occasions since the start of 2014 in which the Secretary General of his Department has been involved in the clearing or approval of material for release under freedom of information legislation. [11799/15]
View answerUnder section 20 of the Freedom of Information Act, 2014 I have delegated the powers of decision maker and reviewer to officers in my Department. In practice this means that Assistant Principal Officers or equivalents are decision makers and Principal Officers or equivalents act as reviewers of Freedom of Information requests made under the Act to my Department. These officials have the sole responsibility for deciding on the release of records arising from a freedom of information request, or carrying out internal reviews of decisions made.
The Secretary General is not involved in clearing or approving material for release under the legislation.
272. Deputy Clare Daly asked the Minister for Finance in view of net receipts per sector being recorded by the Revenue Commissioners (details supplied), if he will clarify where revenue earned by the State in respect of Ireland's producing gas fields is recorded in this publication and under which sector. [11817/15]
View answerI am informed by the Revenue Commissioners that net tax receipts in respect of activities such as producing gas fields would most likely be recorded in the trade sector "Mining and Quarrying" in the "Net Receipts by Sector" table noted by the Deputy.
These sectoral receipts figures are based on a sector identifier used on the tax records called the "NACE code" (the current version of which is referred to as NACE Rev.2), an internationally recognised economic activity code system. NACE classifications on tax records are compiled by reference to the primary area of economic activity reported by individual or corporate taxpayers and the taxes collected are allocated to those sectors without reference to the precise economic activity which generated them. While the accuracy of the NACE codes on tax records is sufficient to underpin broad sector-based analyses, there may be some inaccuracies at individual level. This should be borne in mind when considering the information provided.
273. Deputy Finian McGrath asked the Minister for Finance his views on correspondence (details supplied) in Dublin 3 regarding mortgage debt forgiveness; and if he will make a statement on the matter. [11831/15]
View answerThe correspondence referred to in the Deputy's question makes the case that large scale debt forgiveness by the Government to distressed mortgage holders is not a fair response to the issue and would disadvantage those currently renting and wishing to purchase an affordable home.
The Government has developed a comprehensive cross-Departmental strategy to support households in arrears in line with the main recommendations of the 2011 Keane Report. The primary focus of this strategy is to support those homeowners in difficulty with their mortgage repayments and, insofar as possible, to avoid repossession of the family home. The Deputy will be aware that the Government's mortgage arrears strategy must be viewed as part of the overarching Government Housing Policy, the implementation of which is overseen by the Construction 2020, Housing Planning and Mortgage Arrears Cabinet sub-Committee, which is chaired by An Taoiseach. The overall strategic objective of the Government's housing strategy, which comes under the responsibility of the Minister for the Environment, Alan Kelly TD, is to enable all households access good quality housing appropriate to household circumstances and in their particular community of choice.
276. Deputy Billy Timmins asked the Minister for Finance his plans to hold discussions with the banks or bring forward legislation to prevent banks adding their legal fees onto bank charges of persons who they are taking to court seeking repossession of their house; and if he will make a statement on the matter. [11891/15]
View answerThe Consumer Credit Act provides that any communication issued by or on behalf of a mortgage lender to a borrower which refers to the possibility of possession proceedings being taken under the mortgage, shall contain an estimate of the cost to the borrower of such proceedings.
This requirement is spelt out in more detail in the CCMA and at various points in the MARP process, the lender is required to provide information to the borrower that, with regard to the potential for legal proceedings, irrespective of how the property is repossessed and disposed of, the borrower will remain liable for the outstanding debt, including any accrued interest, charges, legal, selling and other related costs, if this is the case.
Furthermore, the CCMA also requires a lender, following possession and disposal of the secured properties, to notify the borrower of the amount of any costs arising from the disposal which have been added to the mortgage loan account.
Also, in applying the proceeds arising from the sale of the property, the Court may allow for the payment of all charges, costs and expenses properly incurred by the lender as incident to the sale of the property.
However, the CCMA also provides that lenders are restricted from imposing charges and/or surcharge interest on arrears in respect of a primary residence mortgage unless the borrower is "not co-operating". I would therefore, strongly encourage borrowers experiencing mortgage difficulty to communicate and co-operate with a lender to address a mortgage problem and I would ask lenders to address and deal with such problems in a sympathetic way and seek to assist the borrower to meet the mortgage obligations in a sustainable way.
277. Deputy Clare Daly asked the Minister for Finance the level of relationship between Irish State agencies and a bank (details supplied); the number of contracts they hold with respect to Irish treasury operations; if additional overcharging has been discovered; in total the amount of refunds and penalties obtained on foot of misconduct which has been substantiated by the Financial Conduct Authority or admitted by the bank. [11896/15]
View answerThe National Treasury Management Agency (the "NTMA") advised the Committee of Public Accounts in February 2014 that, in view of the nature of the failings at State Street identified by the Financial Conduct Authority, the National Pensions Reserve Fund (the "Fund") had terminated its contract with State Street Global Advisers ("SSGA"), which managed an indexed equity mandate for the Fund. At present, the NTMA has no contracts with companies within the State Street Group.*
Following the issues of overcharging in transition management mandates in 2010 and 2011, State Street agreed in October 2014 to pay further compensation in the amount of €852,000 to the NTMA in the spirit of goodwill and with intent to compensate the Fund for any costs incurred in resolving the matter. This payment is over and above the reimbursement in respect of the overcharging that was already received from State Street (€3.2 million). These payments constitute a full and final settlement of the matter.
* SSGA has also acted as an investment manager of the NTMA pension scheme (which is overseen separately by appointed trustees); this role as investment manager ceased in June 2014 with the exceptions of some legacy property assets of the NTMA pension scheme that are pending divestment and some AVCs.
278. Deputy Michael McGrath asked the Minister for Finance further to Parliamentary Question No. 59 of 26 February 2015, if the Revenue Commissioners' guidelines exist for tax practitioners on the treatment of expenses in such circumstances for contractors; and if he will make a statement on the matter. [11899/15]
View answerI am advised by the Revenue Commissioners that general guidance on the tax treatment of expenses is available on Revenue's website, including Statement of Practice SP/IT/2/2007 (Tax Treatment of the reimbursement of Expenses of Travel and Subsistence to Office Holders and Employees) and two information leaflets IT51 (Employees' Motoring/Bicycle Expenses) and IT54 (Employees' Subsistence Expenses). In 2013, Revenue published two Tax Briefings on the subject of the treatment of expenses for contractors. Tax Briefing No. 3 of 2013 Reimbursement of Travel and Subsistence Expenses by Intermediaries addressed the general treatment of expenses in cases in which services were provided by an individual to an end-user through an intermediary, typically through a company structure. Tax Briefing No. 4 of 2013 Revenue's Contractors Project specifically related to the project referred to in Parliamentary Question No. 59 of 26 February 2015. That publication set out Revenue's approach to the project and provided further guidance on the treatment of expenses.
279. Deputy Michael McGrath asked the Minister for Finance the number of the 11,424 proceedings issued in 2014 for the repossession of principal dwelling houses which relate to properties in each county, in tabular form. [11901/15]
View answerWhile the Courts Service operates as an independent corporate organisation, primary responsibility for reporting on matters before the Courts, including home repossession cases, lies with the Department of Justice and Equality. I have been informed by the Courts Service that the actual number of new cases initiated for repossession of land and/or premises in the period Jan-Dec 2014 is 8,164. It is worth noting also that it is not the case that all Civil Bills for Possession issued will inevitably lead to Possession Bills being granted by the Courts, as many cases will be withdrawn at the request of either the lender or the borrower.
I have asked the Department of Justice and Equality to source County level data on repossessions from the Courts Service and to forward it directly to you.
280. Deputy Michael McGrath asked the Minister for Finance the number of the 11,424 proceedings issued in aggregate in 2014 for the repossession of principal dwelling houses by Permanent TSB, Allied Irish Banks, Educational Building Society, the Irish Bank Resolution Corporation and all other credit institutions; and if he will make a statement on the matter. [11902/15]
View answerWhile the Courts Service operates as an independent corporate organisation, primary responsibility for reporting on matters before the Courts, including home repossession cases, lies with the Department of Justice and Equality. I have been informed by the Courts Service that the actual number of new cases initiated for repossession of land and/or premises in the period Jan-Dec 2014 is 8,164. It is worth noting also that it is not the case that all Civil Bills for Possession issued will inevitably lead to Possession Bills being granted by the Courts, as many cases will be withdrawn at the request of either the lender or the borrower.
The Central Bank publish a quarterly Residential Mortgage Arrears and Repossessions statistical release which provides some information about home repossessions at an aggregate level only, and consequently no institutional level breakdown is available. The last release, published on 6th March 2015, was for end-Q4 2014 and is available here:
http://www.centralbank.ie/polstats/stats/mortgagearrears/Pages/releases.aspx.
I am informed by the Central Bank that it is precluded for confidentiality reasons from publishing data which identifies individual institutions.
