Michael Healy-Rae
Question:135. Deputy Michael Healy-Rae asked the Minister for Finance his views on a matter (details supplied) regarding the help-to-buy scheme; and if he will make a statement on the matter. [2681/17]
View answerTuesday, 24 January 2017
Questions (135)
Written answers
The process to register as a 'qualifying contractor' for the Help to Buy incentive requires documentation be submitted which shows:
- that the contractor has valid tax clearance and is considered compliant for Relevant Contracts Tax (RCT) purposes
- details of the proposed or actual qualifying residences. Such details include a copy of the planning permission, the residences already constructed (if already built) and details of the ownership of the land on which the qualifying residences are, or will be, constructed.
In addition, a short one-page registration form, HTB1, seeks the applicant's consent to have his, her or its name and tax registration number published on the Revenue website as a 'qualifying contractor'. The publication details are necessary in order that potential purchasers can check that the contractor qualifies under the incentive.
The Help to Buy scheme is a generous incentive that facilitates the purchase of a new home by a First Time Buyer. For new builds, the rebate is payable on signing the contract to purchase the property rather than upon completion of the sale. This means that it is necessary that details of the planning permission and ownership of the land are provided to Revenue. This information is completely within the control of the builder/developer. The other key condition is that of tax clearance/tax compliance. If a contractor is not tax compliant, in order to participate in the scheme, he or she should engage with Revenue to bring his or her tax affairs up to date.
These administrative requirements on contractors to be registered as 'qualifying contractors' are necessary in order to safeguard public monies being paid under the incentive. I do not regard such requirements as particularly onerous and the information sought is generally seen as the minimum necessary to satisfy Revenue that the purpose of the incentive, the increased provision of houses for First Time Buyers, will be delivered, and by tax compliant contractors.
The Deputy should also be aware that Help to Buy claimants who purchase their home on or after 1 January 2017 are effectively instructing the Revenue to pay their Help to Buy rebate directly to their approved qualifying contractor's bank account. Consequently, it is crucial that the bona fides of the contractor in question is fully established at the point the rebate is made.
As regards the level of interest on the part of contractors, I am advised by Revenue that in the period up to and including 20 January 2017, there have been 53 applications for registration. Thirteen of these applications have been registered as 'qualifying contractors' and their details published on the Revenue website. The remaining applications are being processed and any unsuccessful applicants have been advised about how to address any issues arising in their application.
I am further advised by Revenue that they have seen a steady increase in the number of applications. There were nine applications received in 2016, and in the first three weeks of January the number of weekly applications have been 8, 14 and 22, respectively. I believe that these statistics show that contractors do indeed believe that it is worth their while registering for the incentive.