Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I thank the Deputy. As he knows, mortgage interest tax relief, in the form of a mortgage interest tax credit, is a one-year temporary relief available to homeowners with an outstanding mortgage balance on their principal private residence of between €80,000 and €500,000 on 31 December 2022. It is available at the standard rate of income tax and is based on the increase in the interest paid in 2023 over interest paid in 2022. The value of the relief is equal to the lesser of 20% of this excess interest amount or a maximum of €1,250. Where the interest payments in respect of the 2022 or 2023 tax years are not for a full year, pro rata application will be done to ensure interest is applied on a period of equivalence basis and that the cap is adjusted accordingly.

To avail of the relief, the taxpayer must file a 2023 income tax return and upload their certificate of mortgage interest for 2022 and 2023, as well as confirmation of their mortgage balance at the end of 2022. Furthermore, the taxpayer must be compliant with local property tax requirements and must have paid income tax in 2023. The relief operates by way of a credit offset against a taxpayer’s income tax liability for 2023.

I am advised by Revenue that, as of 3 April 2024, 17,059 taxpayer units made a claim for this credit on their 2023 PAYE income tax return and 14,762 claimants received a refund of tax, totalling more than €14 million. Of these, 188 claimants paid tax which was less than the full credit claimed. Revenue notes that other credits and reliefs claimed, such as health expenses, may also have contributed to the overall amount of refunds issued. A further 2,091 claimants are either in a balanced position or had an underpayment reduced by the credit being applied to their record.

An additional 206 claimants are not in a position to benefit from the payment because they did not pay any income tax in 2023. I will add further information in a moment.

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