Twitter is currently alight with all manner of inner monologues surrounding The Budget for 2017, announced just this afternoon by Finance Minister Michael Noonan. Normally, finding out where else we’re going to be utterly screwed – tax wise – gives us actual anxiety, but having scanned the finer points of Noonan’s grand plans, it seems like things are actually beginning to look up for Irish homeowners.
Here’s what we’re taking from it.
First of all, let’s address the dread of the first-time buyer: A ‘help to buy’ scheme for first-time buyers will see a 5 per cent PAYE rebate of up to €20,000 over four years on new homes worth up to a staggering €600,000. So basically, what you’re getting here is a rebate of income tax over the previous four years, up to a maximum of 5%, which should certainly help with the deposit that’s been keeping you up at night. You won’t get to avail of this scheme if you buy a GAFF that’s over 600 grand, but we’re guessing you’re all good on the deposit front, if your property budget is on that end of the spectrum.
Unfortunately, second-hand homes are exempt from this scheme, but with so many new developments on the horizon, it certainly increases your chances of buying something in brand new, turnkey condition. What will come as welcome news for those buying second-hand homes, however, is the announcement that The Home Renovation Incentive Scheme is being extended by two years – right up to the end of 2018 – to help those not buying new GAFFs.
In other good news, Mortgage Interest Relief will be extended beyond December 2017 to 2020.
If buying’s not yet on the cards, there’s been provisions made to make life a little easier for renters too, with more accommodation options. If you’re renting a room in your home, the income ceiling for that scheme is to be increased by €2,000 meaning you can take in €14,000 a year tax-free, putting more rental options on the market. “This will allow homeowners to rent out additional rooms at current average prices while remaining within the scope of the scheme,” said Mr Noonan. The level of interest relief for landlords is to be increased to 80 per cent and the full 100 percent will be restored over a number of years.
If you’re getting a financial dig-out from your parents (thank you, parents, did we tell you we love you?), there’s a considerable improvement there too; the Capital Acquisitions Tax on gifts from parents to children is being increased by €30,000 to €310,000, which helps a lot if, for example, you’re inheriting a property.
Elsewhere, the ongoing process of phasing out the Universal Social Charge, among other leniencies, will eventually leave a few euro left over each month to spend on, y’know, scatter cushions and the likes.