Seán Sherlock
Question:143. Deputy Sean Sherlock asked the Minister for Finance if clarity will be provided in relation to an issue (details supplied). [34278/21]
View answerTuesday, 29 June 2021
Questions (143)
Written answers
In relation to the question raised in the details supplied with the Deputy's question, the position is that, as part of the normal course of events, the future of the HTB scheme beyond its current sunset date of 31 December 2021 is a matter that will fall to be considered in the context of Budget 2022 and the subsequent Finance Bill.
The Help to Buy (HTB) incentive is a scheme to assist first-time purchasers with a deposit they need to buy or build a new house or apartment. The incentive gives a refund on Income Tax and Deposit Interest Retention Tax (DIRT) paid in the State over the previous four years, subject to limits outlined in the legislation. Section 477C Taxes Consolidation Act (TCA) 1997 outlines the definitions and conditions that apply to the HTB scheme.
In summary, the process to claim HTB involves two stages, application stage and claim stage. At the application stage, the claimant notifies Revenue of his/her intention to make a HTB claim and checks are carried out to ensure the applicant satisfies certain conditions of the scheme. Once confirmed, Revenue notifies the applicant about the potential HTB refund available.
Section 477C (8) provides:
"An application made in any tax year shall cease to be valid on the earlier of the following events:
(a) (i) failure by the applicant to satisfy the conditions specified in subsection (6)(b);
(ii) on the rescission of the applicant's tax clearance certificate in accordance with subsection (3A) of section 1095; or
(iii) on the falling of 31 December in the tax year in which the application is made.
(b) Notwithstanding paragraph (a) and subsection (25), where an application is made under this section in the period commencing on 1 October and ending on 31 December in any of the tax years [2017 to 2021] (hereafter in this paragraph referred to as the “first-mentioned period”), and the corresponding claim is made under subsection (3) in the period commencing on 1 January and ending on 31 March of the following year, the applicant shall be deemed to have made his or her claim in the first-mentioned period.
(c) No claim may be made on foot of an application which ceases to be valid in accordance with paragraph (a)."
In respect to point (a)(iii) above, for example where an application is made during the period 1 October to 31 December 2021, and a claim is made on foot of such an application in the period 1 January to 31 March 2022, the claim will be deemed to have been made in 2021. In such cases, where the corresponding claim is made between 1 January and 31 March of the following year, the claim will be deemed to be made in the prior year. However, the timeframe for entering into a contract to purchase or, in the case of a self-build, to have drawn down the first tranche of a qualifying loan does not change, the end date of 31 December 2021 for so doing still applies.
Revenue Tax and Duty Manual Part 15-01-46 outlines further guidance on the conditions and operation of the HTB scheme.