Thousands of homeowners are missing out on lucrative housing-related tax reliefs, comments Eileen Devereux, commercial director with Taxback.com.
Taxback.com’s latest Taxpayer Sentiment Survey has found that 65% of people do not know what the Home Renovation Incentive (HRI) is, 60% don’t know what the Rent a Room Scheme is, while 57% don’t know about the Help to Buy Scheme.
“We believe there are many more people who could be availing of these tax reliefs. Some people could be missing out on the reliefs available to them, due to a lack of awareness or understanding,” said Eileen Devereux.
Secondly, reliefs such as Rent a Room could help to alleviate some of the current congestion problems in our rental sector, and could help, to some degree, to take pressure off the market which could have a knock-on affect on costs, availability etc. However, if 60% of people don’t know this solution is out there – then how can it be used to fix any problems?
The figures for those availing of tax reliefs suggests there may be thousands of others failing to apply. Just 7,350 people took up Rent a Room relief in 2016, with countless others missing out on earning up to €14,000 tax-free from renting out a room in their home.
In 2018, some 28,882 works were carried out under the HRI, but how many others built an extension, a new garage, converted an attic, or installed a new kitchen or bathroom without availing of a tax credit of 13.5% of the total cost of qualifying repairs, renovations, and improvements?
“More needs to be done to ensure people get to the information they need to make smarter choices about their finances. The level of understanding of key housing-related tax reliefs among the general public may be leaving a lot of people out in the cold, with low awareness of some key tax incentives that could benefit many Irish home-owners.”