The Help to Buy (HTB) incentive was introduced in 2017. The measure is currently scheduled to expire on 31 December 2021.
HTB gives a refund of Income Tax and Deposit Interest Retention Tax (DIRT) paid in Ireland over the previous four years, subject to limits outlined in the legislation. An increase in the supply of new housing remains a priority aim of Government policy.
The scheme is designed to stimulate the supply of new houses in the housing market and to assist first-time buyers in accumulating a deposit for a new home. In order to further help meet these goals, I announced an enhancement to the existing scheme with effect from 23 July last for the remainder of 2020 as part of the July Stimulus Package. The legislation that gives effect to this is set out in the Financial Provisions (Covid-19) (No.2) Act 2020. The Finance Act 2020 further extended the period of application of the enhanced levels of support until 31 December 2021.
The question of the future of HTB support beyond its current expiry date is a matter that will be considered in due course in the context of Budget 2022 and the subsequent Finance Bill.
With regard to the other parts of the Deputy's question, I am advised by Revenue that where the conditions of the scheme are met, the incentive gives a refund of Income Tax and Deposit Interest Retention Tax (DIRT) paid in the State over the four tax years preceding the year of application, subject to limits outlined in the legislation. The HTB claimants may select all or any of the previous four tax years for the purposes of calculating the HTB refund. For the purposes of the HTB scheme, a tax year is considered January to December of the relevant year. Where an applicant has only paid Income Tax for part of a tax year (e.g. if only worked August to December), the applicant may still choose that year as a relevant tax year for the purposes of the HTB scheme, and any Income Tax / DIRT paid during that year will be included in the HTB refund calculations, subject to the limits outlined in legislation.
The Tax and Duty manual Part 15-01-46 Help to Buy Scheme under part 11 provides details on how the payment is calculated and example scenarios for reference. In summary, HTB will be calculated firstly based on the amount of Income Tax paid in the preceding four years, starting with the earliest year selected by the claimant. Where the HTB maximum has not been reached, DIRT paid in the preceding four years will be taken into account, starting with the earliest year selected by the claimant.