Dáil Éireann Debate, Wednesday - 2 November 2016
103. Deputy Niamh Smyth asked the Minister for Finance the number of persons deemed eligible for the help-to-buy incentive announced in budget 2017 who will be reimbursed by the Revenue Commissioners (details supplied). [32577/16]
Amharc ar fhreagraUnder the Help to Buy initiative, subject to satisfying the full conditions of the scheme, a first time purchaser will be entitled to claim a refund of income tax and DIRT paid over the previous four years. The terms of the scheme are set out in Finance Bill 2016. The refund will be subject to a maximum of 5% of the purchase price of a new home, or in the case of a self-build 5% of the approved value of the dwelling, up to a value of €400,000. Where new homes are valued between €400,000 and €600,000, the maximum relief will be €20,000 per property (i.e. €400,000 @ 5%).
The payment process for the tax rebate will vary depending on a number of factors, including whether an individual is purchasing a newly built residence or constructing his or her own self-build residence. In the case of a contract to purchase a new residence entered into in the period from 19 July 2016 to 31 December 2016, the tax rebate will be paid directly to the first-time buyer after the Revenue online system comes on stream in January 2017.
In all other cases involving contracts for the purchase of a new residence, the tax rebate will be paid directly to the contractor and will form part of the deposit required from the purchaser. This will be treated by the contractor as a credit against the purchase price of the residence.
In the case of a self-build residence, the tax rebate will be issued to the first-time buyer after he or she draws down the first tranche of the mortgage loan used to finance the construction of the residence.
As the initiative is demand-led, it is not possible to forecast the numbers of first-time buyers that will choose to avail of it on an annual basis or the average benefit that these individuals will receive. However, initial forecasts of the potential costs by my Department for the coming years, as outlined in Budget 2017, are based on figures in relation to the number of new homes built in recent years and the proportion of which that were purchased by first-time buyers.
