Rent Tax Credit
This new tax credit was introduced in the recent Finance Act 2022. It applies from 2022 and it is now possible to claim relief for 2022 by submitting your income tax return.
The maximum value of the tax credit is €1,000 for a jointly assessed couple and €500 for other cases.
The tax credit is available in the following circumstances:
- Where the claimant makes a qualifying payment in respect of his/her principal private residence.
- Where the claimant makes a qualifying payment in respect of a “second home” which is used for employment, trade or profession purposes.
- Where the claimant makes a qualifying payment in respect of a property used by his or her child for education purposes. A list of qualifying colleges and courses is published on Revenue’s website and can be found here. The student must be under 23 years old at the start of the tax year in which he or she first commenced an approved course.
The rent tax credit is available for rent payments only and not for other items such as security deposits, meals and utilities.
The tenancy must be either:
- Registered with the Residential Tenancies Board, or
- Related to the use of a room/rooms in the landlord’s principal private residence.
There are “connected party rules” where the rent tax credit will not be available:
- Where the rent relates to either category 1 or 2 above, the landlord and tenant cannot be parent/child or vice versa.
- Where the rent relates to category 3 above (child in education), the landlord and tenant cannot be related in any way.
The rent tax credit can be claimed for 2022 – 2025. Receipts and other supporting documentation should not be submitted in support of your claim, but these items must be retained.
Claims for 2022 can be made now by submitting a tax return. A claim for 2023 can also be made by using Revenue’s “Real-Time Credit” facility. This can be accessed through MyAccount, under the “PAYE Services” and “Manage my Record” tabs.
There are further conditions and information is available on the Revenue’s guidance notes. These notes are available here. There are qualifying checklists at Appendices 2 – 4 in respect of each of the 3 categories referred to above.