Dáil Éireann Debate, Tuesday - 29 May 2018
154. Deputy Bernard J. Durkan asked the Minister for Finance the status of the rural renewal scheme in terms of the benefits for mortgage relief; the length of time for which this and other benefits under the scheme will be available; and if he will make a statement on the matter. [23108/18]
Amharc ar fhreagraThe rural renewal scheme provided for a scheme of tax reliefs aimed at invigorating certain areas of rural Ireland. Relief is only available for expenditure on construction, refurbishment or conversion work that was carried out during the qualifying period for the scheme. The qualifying period for the rural renewal scheme originally terminated on 31 December 2004 but was extended to 31 December 2006 where a valid application for full planning permission was submitted to the relevant local authority by 31 December 2004. The qualifying period was further extended to 31 July 2008, subject to the additional requirement that work to the value of at least 15% of the actual construction, refurbishment or conversion costs must have been carried by 31 December 2006.
While the scheme has been terminated, tax relief may continue to be claimed on expenditure incurred prior to the termination date in question.
There is no mortgage relief available under the scheme. The benefit available is tax relief in the form of:
- accelerated capital allowances in respect of capital expenditure incurred on the construction or refurbishment of certain industrial and commercial buildings or structures,
- a deduction against rental income in respect of expenditure on the construction, conversion or refurbishment of certain residential property, and
- a deduction against total income for expenditure incurred by owner-occupiers on the construction, conversion or refurbishment of residential property.
The accelerated capital allowances are available at a rate of 50% of expenditure in the first year and 4% thereafter. Additionally, owner-occupiers (traders) could opt to claim free depreciation, which is an acceleration of the normal annual allowance, of up to 50%. In relation to the deduction against rental income, this is given in full in the first year that the property is let. Any unused relief is carried forward against rental income in future years. The deduction for owner-occupiers of residential property is given at a rate of 5% over 10 years in the case of construction expenditure and 10% over 10 years in the case of conversion or refurbishment expenditure.
