So you have a new/existing mortgage or loan relating to your home and want to know how much you are due in Mortgage interest relief. There are 3 questions you need to ask yourself in relation to this:
- Have I an eligible loan?
- Am I a First Time Buyer (FTB)?
- What are the rates of relief?
Mortgage Interest Relief for Non-First time Buyers
If you are a non-First Time Buyer (non-FTB), you can now claim interest relief of up to €450 a year if you single and €900 if you are married. This equates to €37.50 a month if you are single and €75 if married for 2009.
How is this calculated.
Non-FTB mortgage interest relief gives you relief on the first €3,000 of interest on your mortgage at 15%, which gives you the €450 from above. You get to double that if you are married.
If you don't know what the split is on your mortgage or will be on a new mortgage, ask your bank. Also, your bank will send you a statement after the end of the year stating how much interest you paid in the year.
First Time Buyers
First Time Buyers (FTB's) can receive interest relief of:
- In years 1-2 of a mortgage up to €2,500 interest relief a year, or €208 a month
- In years 3-5 of a mortgage, up to €2,250 interest relief a year, or €188 a month
- In years 6-7 of a mortgage, up to €2,000 interest relief a year, or €167 a month
- These rates can be double if married, depending on FTB status.
Will you receive that much Relief? Probably not.
For the average mortgage holder, you will not get the maximum allowed reliefs above. The interest relief above is based on you paying the maximum amount of interest that can be relieved on your mortgage in a year of €10,000 (double if married). If you are paying less than this, your mortgage interest relief will be proportionately less.
Ask your bank for an estimate of your annual interest charge to help you calculate your mortgage interest relief.
How to Apply
Mortgage Interest Relief may be applied for on the internet at www.revenue.ie/trs1
This is a simple, quick and effective way to avail of your tax relief. Alternatively, a manual version of the form may be downloaded from www.revenue.ie/forms/trs1.pdf
For new mortgages, your mortgage lender should be able to help you claim this relief.
If you have not claimed mortgage interest relief, you can still claim for the current year and the 4 preceding years.
The form for prior years is available to download at www.revenue.ie/forms/trsp.pdf
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