Renters at risk of losing out on up to €1,000 in tax relief

To claim the full rent credit, a single person must spend at least €2,500 a year on their rent and couples must spend at least €5,000.

Thousands of people are at risk of missing out on tax relief worth up to €1,000 as they are unaware it exists.

Introduced as part of Budget 2023, it is estimated that 400,000 are eligible for the new rent credit. However, almost 70% of people are not aware of its introduction, according to a recent survey.

Amid the cost of living crisis, renters have been hit hard as rents increased by 14.1% over the past year - the highest annual increase since Daft began reporting on rents in 2006.

For the thousands that are struggling, the tax credit can provide a small bit of welcome relief.

The lack of awareness surrounding the rent credit was identified as part of a survey conducted by Taxback.com, which warned the effectiveness of the relief will be limited unless the Government do more to inform people of their eligibility.

It is available to tenants as well as parents paying rent on behalf of a child who is living away from home while attending college.

Single people can claim up to €500 per year while married couples and civil partners can claim up to €1,000.

To claim the full rent credit, a single person must spend at least €2,500 a year on their rent and couples must spend at least €5,000.

Those living in a house share situation should claim individually rather than as a group as each tax-paying tenant can claim the credit. However, those already availing of State housing supports such as HAP or Rental Accommodation Scheme are ineligible.

Unusually, even though the measure was introduced late last year, renters can claim the rent credit for 2022.

A claim can be made to Revenue for the tax years 2022-2025 inclusive.

In 2021, €300m in tax back was left unclaimed by around 450,000 people - double the figure for 2020.

Tax experts are concerned that the new tax credit will become another unclaimed relief as people are unaware of their eligibility.

Marian Ryan, Consumer Tax Manager with Taxback.com, advises people to check their eligibility even if they think they don't qualify.

"There are some people who could lose out on the rent credit because they mistakenly believe they are not entitled to claim it," said Ms. Ryan.

"If you are not paying rent for a principal private residence, or on behalf of a child who is living away from home to attend college, it’s worth knowing that you can generally still claim the rent credit if you are renting a residential property which is different to your principal private residence if you need to rent that property for the purposes of work or to attend an approved course."

Renters have four years to claim the credit based on the four-year lookback rule but are encouraged to apply for the relief promptly.