Michael Healy-Rae (Kerry, Independent)
Link to this: Individually | In context | Oireachtas source

354. To ask the Minister for Finance his views on matters (details supplied) in relation to the rent tax credit; and if he will make a statement on the matter. [1642/23]

Michael McGrath (Cork South Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

The Rent Tax Credit was introduced by Finance Act 2022 and will be available in respect of qualifying payments made during the 2022 to 2025 years of assessment inclusive. It is provided for in section 473B of the Taxes Consolidation Act 1997 (TCA 1997). Qualifying payments must be made under a tenancy.

There are two specific exclusions from the definition of a tenancy under the Rent Tax Credit provisions. These are:

1. a tenancy which has a duration of 50 years or more at the point of commencement, and

2. a tenancy which includes a ‘rent to buy’ type arrangement or clause.

Otherwise, for an individual to claim the Rent Tax Credit, Revenue advise me that the tenancy must be a rental arrangement which falls into one of the categories below:

1. An agreement, contract or lease which is required to be registered with the Residential Tenancy Board (RTB) under Part 7 of the Residential Tenancies Act 2004 and has been so registered. This type of tenancy will commonly, but not exclusively, be seen where a tenant, or tenants, have exclusive use of an entire property or self-contained unit within Student Specific Accommodation. Where a rental arrangement is of a type which is required to be registered with the RTB, the landlord must have complied with this registration obligation in order for the claimant to receive the Rent Tax Credit.

2. A licence for the use of a room, or rooms, in an individual’s principal private residence. This type of tenancy will commonly, but not exclusively, be seen where the landlord lives in the same property as the tenant, in what is commonly referred to as ‘Rent a Room’ or ‘digs’ arrangement. Such rental arrangements are not required to be registered with the RTB under Part 7 of the Residential Tenancies Act 2004, and therefore availability of the Rent Tax Credit in such circumstances is not dependent on the tenancy being registered.

The Rent Tax Credit does not, therefore, impose any additional RTB registration obligations on landlords, however, where appropriate, a landlord must comply with existing registration obligations in order for the tenancy concerned to come within the scope of the Rent Tax Credit.

The question of which tenancies should be registered with the RTB is a matter on which the RTB may advise. 

To facilitate claimants in receiving the Rent Tax Credit, landlords should familiarise themselves with their RTB registration obligations and ensure that they have fulfilled same. Details of the type of tenancies which must be registered with the RTB, and the process by which such registrations may be completed, can be found on the RTB website at www.rtb.ie/register-a-tenancy.

It should be noted that the RTB registration requirements are different for Student Specific Accommodation as compared with those in the private rented sector generally. Student Specific Accommodation is housing built or designated for students and used for the sole purpose of providing residential accommodation to students during the academic term. The Residential Tenancies Act (Amendment) Act 2019 brought Student Specific Accommodation under the remit of the RTB on 15 July 2019, regardless of whether there is a lease or license agreement in place. As a result, all Student Specific Accommodation tenancies/licences entered into on or after 15 August 2019 must now be registered with the RTB. Further information on the registration requirements for Student Specific Accommodation is available on the RTB website: www.rtb.ie/register-a-tenancy/student-specific-accommodation.

Detailed information in respect of the Rent Tax Credit, including guidance on the full range of conditions which must be met and how to make a claim, can be found in Revenue’s Tax and Duty Manual Part 15-01-11A at www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-11A.pdf.