Help to Buy Scheme for First Time Buyers

09 Jan 2017

Help to Buy Scheme for First Time Buyers

 

First time buyers can claim a tax rebate equal to 5% of the value of the new house they are buying from January 2017. A New home is defined as “a new building which was not previously used, or suitable for use, as a dwelling.”  Second hand homes are not eligible.

Some people are referring to this scheme as a First Time Buyers Grant.

 

The Help to Buy tax rebate of up to €20,000 will be available only to first time buyers to help them purchase a new home in Ireland. It is aimed at people who might not be able to afford to put down a 10% deposit in line with Central Bank Mortgage Rules.

The  tax rebate can  also be claimed on new homes that were bought since July 19th 2016.  But, if you signed a contract to buy a property (or drew down the first tranche of the mortgage for a self-build) before 19th July 2016  you will not be eligible for the Help to Buy Scheme

Important : The rebate applies to NEW homes only (Including self builds)
The Help to Buy scheme is due to finish at the end of 2019.

Bonus : If first time buyers also manage to take out one of the mortgages with cashback – such as with Bank of Ireland , they could get as much as 8% total cashback.. See the Lowest Mortgage Rates Here

 

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Applications for Help to Buy

There are 2 stages to the HTB Application :
Stage 1 is to work out the maximum relief available to you under the scheme based on tax payments you made in the relevant years.  You can apply before you choose a house or apply for a mortgage. Once you know the maximum rebate possible –  you can then  arrange a mortgage and/or sign a contract with a prospective Qualifying Contractor.

When mortgages and contracts are signed you will need to  complete Stage 2 of the Help to Buy Claim  where the exact rebate will be worked out based on purchase price.

Payments of the rebate will be made directly to the builder/developer as part of  the deposit.  The builder/developer must have registered with Revenue as a registered contractor under the Help to Buy Scheme . Only properties built by a registered contractor will be eligible.
In the case of a self build – the payment wil be made direct to the bank providing the mortgage.

Before making an application for the Help to Buy Scheme , you will  first need to complete Online Forms 12 (if a PAYE taxpayer) OR Forms 11 (if self-assessed), in respect of each of the  four tax years and you must pay any outstanding taxes due.

Online applications for the Help to Buy scheme are now being accepted by Revenue since Jan 3rd 2017.
PAYE employees can apply on Revenue’s MyAccount .
Self Assessed taxpayers can apply through ROS

Applicants will also need to register to use the Revenue’s MyEnquiries service.

 

Source – http://www.moneyguideireland.com/

Image Credit | Unsplash

 

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