Carrying out work on your home can be a costly process, but did you know that you can avail of recent Government tax breaks for renovations? They are available for both home owners and landlords, however there are different time periods for both. Home owners can claim the tax credit for work carried out between the 25th of October 2013 and the 31st of December 2018, while landlords can claim for work completed between the 15th of October 2014 and the 31st of December 2018.
Both the property owners and the contractors must be tax compliant. Homeowners must be up to date on Local Property Tax and Household Charge payments. Contractors must be registered for VAT and RCT with works carried out being charged at the 13.5% VAT rate (purchases subject to the VAT rate of 23% will not qualify for the scheme). Moreover, the contractor must register the works carried out on the Revenue Online Service (ROS), along with the payment details, before you can claim your tax credit.
The majority of common renovations qualify for the HRI tax credit, such as painting and decorating, extensions, new kitchens, landscaping, alarm installations and even new windows and doors.
The total value of the work has to be greater than €4,405 before VAT, with a maximum of €30,000. The minimum spend of €4,405 applies to all jobs on the property combined.
How it works
The HRI tax credit will be added to your tax credits over two years, following the year the work was completed. This can save you a large sum in taxes, for example, if you have the minimum amount of work carried out (€4,405 before tax), you can claim a tax credit of €595. Likewise, if you have the maximum amount of work carried out (€30,000 before tax), you can claim a tax credit of €4,050.
What you need to do
To claim the HRI tax credit for qualifying works, you must first ensure the contractor enters all the relevant details via the Revenue Online System (any tax registered contractor will be aware of this scheme). Next, you apply to the Revenue Commissioners for your tax credit using your PPS number, Local Property Tax Number and Pin.
Once you have applied the HRI tax credit you will be eligible to claim a tax rebate. To find out if you’re eligible to claim tax back, fill out our 60-second online application form. If you would like more information in relation to tax credits that can help you save, contact our expert team at Irish Tax Rebates.