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Tax Reliefs

Dáil Éireann Debate, Thursday - 9 February 2012

Thursday, 9 February 2012

Ceisteanna (72)

Dan Neville

Ceist:

71 Deputy Dan Neville asked the Minister for Finance the position regarding tax relief at source in respect of a person (details supplied) in County Limerick. [7535/12]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Minister for Finance)

As I announced in the Budget, the proposed new 30% rate of tax relief in respect of interest paid on qualifying home loans for first time buyers who took out their first qualifying home loan in the period between 2004 and 2008 (both dates inclusive) comes into effect as regards the 2012 tax year and subsequent tax years. The necessary legislation is included in the Finance Bill which I published yesterday. I am informed by the Revenue Commissioners that the tax relief (including the proposed new 30% rate of relief) in respect of interest paid on qualifying home loans is given by qualifying lending agencies through the tax relief at source (TRS) system. This requires the various lending agencies to make adjustments to their computer systems.

I am further informed by the Revenue Commissioners that they have been in contact with all qualifying lenders to ensure that the necessary software changes to the tax relief at source (TRS) system are made to cater for the new 30% rate of tax relief and to ensure that the relief can be passed on to borrowers by qualifying lenders without undue delay. All lenders have been requested to confirm when they will be in a position to work with Revenue to implement the Budget rate change. However, the speed with which the software changes necessary to grant the new 30% rate of tax relief to borrowers can be developed and implemented by lenders may vary from lender to lender. As an interim relieving measure, a 25% rate that had previously been tested with lenders has been applied to the appropriate cases in advance of legislation.

In the case of the person concerned, the rate of 25% has been applied as an interim measure until the new 30% rate can be implemented. The lender in question has not to date informed Revenue when it will be in a position to test the increased 30% rate on its ICT system.

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