Dáil Éireann Debate, Tuesday - 17 October 2023
158. Deputy Eoin Ó Broin asked the Minister for Finance to set out what his Department's response is where a developer/builder received help to buy finance but fails to complete the houses to which the help to buy funding applies; and in cases where the buyer is no longer able to occupy the home, whether the Revenue Commissioners can recoup the help to buy funding and the original buyer access the help to buy scheme at another property. [44749/23]
View answerThe Help to Buy (“HTB”) incentive is a scheme to assist first-time purchasers (“FTP”) with the deposit they need to buy or build a new house or apartment. The incentive gives a refund of Income Tax (“IT”) and Deposit Interest Retention Tax (“DIRT”) paid in Ireland over the previous four years, subject to limits outlined in the legislation.
Section 477C Taxes Consolidation Act 1997 (“TCA 1997”) outlines the definitions and conditions that apply to the HTB scheme. Where a contract for the purchase of a qualifying residence is entered into by the HTB applicant and all conditions of the HTB scheme are satisfied, the HTB amount (i.e., the IT and DIRT paid by the FTP) in the previous 4 years) is paid directly to the Qualifying Contractor (“QC”) to be offset against the purchase price of the property.
Section 477C (18)(d) TCA 1997 provides that a claw-back of the HTB amount from the QC will arise where the sale of the property, for whatever reason, is not completed within 2 years from the date the HTB payment is made. Where this occurs, the QC is required to pay the HTB amount to Revenue within 3 months from the end of the 2-year period. This 2-year period may, in limited circumstances, be extended, providing the property is substantially completed within the 2-year period, and is likely to be completed within a reasonable period of time. Conversely, if Revenue has reasonable grounds to believe that the sale of the property will not be completed within this 2-year period, Revenue may issue a notice to that effect to the QC. Where a notice is issued, the QC must pay the HTB amount to Revenue within 3 months of the notice.
Where a QC fails to make the payment of the HTB amount to Revenue as required, section 477C(20) TCA 1997 provides that Revenue can make an assessment or amended assessment in respect of the HTB amount due. The QC will have a right to appeal this assessment. Statutory Interest will apply, and the QC may also be liable to penalty.
Where a claw-back of the HTB amount from the QC arises, the HTB claim may be cancelled from the purchaser applicant’s record. As such, should an applicant decide to subsequently purchase an alternative qualifying property, the applicant would remain eligible for HTB relief providing all of the conditions of the HTB scheme are met.
In order to have a HTB claim cancelled, an applicant would need to make a case to Revenue detailing the facts and circumstances of the case and the reason(s) why the purchase did not complete within the required time-frame. This would be done by the applicant by contacting Revenue online through myAccount.
