As you probably know by now, a new Tax Credit for renters was introduced by the Minister for Finance in the 2023 Budget. This rent credit can be claimed for the years 2022 to 2028 inclusive and reduces the amount of income tax that tenants renting accommodation in Ireland will have to pay.

The amount of Rent Tax Credit you can receive depends on the tax year and the rent you pay. It is calculated as 20% of your qualifying rent payments for the year, capped at the following amounts:

  • 2022 and 2023: maximum credit €500 per year for a single person and €1,000 per year for a jointly assessed married couple or civil partners.
  • 2024 to 2028: maximum credit €1,000 per year for a single person and €2,000 per year for a jointly assessed married couple or civil partners.

Are you eligible?

You must meet the following criteria:

  • You are paying for private residential accommodation situated in Ireland
  • You have paid more income tax in Ireland than the value of the credit you are claiming
  • You are not in receipt of housing assistance such as Housing Assistance Payment (HAP), Rent Supplement or the Rental Accommodation Scheme (RAS) or other housing supports. Student Universal Support Ireland (SUSI) grants are not treated as state housing support for this credit.

Your tenancy must fall within the definition of a qualifying tenancy for Rent Tax Credit purposes. In general this means either:

  • A tenancy that is required to be registered with the Residential Tenancies Board (RTB) under the Residential Tenancies Act 2004 and has been so registered, or
  • A licence for one or more rooms in your landlord’s principal private residence, including rent-a-room or student ‘digs’ arrangements.

Where your tenancy is required to be registered with the RTB, the landlord must have complied with that obligation. Licences in the landlord’s principal private residence are generally not required to be registered and remain eligible for the credit.

  • The landlord is not your parent or child. For parents paying rent for a property used by their child, the credit is not available if the parent or the child is related to the landlord (for example, grandparent, grandchild, brother, sister, uncle, aunt, niece or nephew).

The Rent Tax Credit is broadly available in the following three circumstances:

  1. Where you make qualifying rent payments in respect of your principal private residence.
  2. Where you make qualifying rent payments in respect of a second home that you use to facilitate your attendance at, or participation in, your employment, office holding, trade, profession or an approved course.
  3. Where you, as a parent, make qualifying rent payments in respect of a property used by your child to facilitate his or her attendance at, or participation in, an approved course. For this purpose, the child must have been under 23 at the start of the tax year in which he or she first commenced an approved course. The credit can continue whilst the child turns 23 and may also apply where the child undertakes a later approved course, subject to this condition

How do you claim?

To claim the credit, a formal claim must be made with Revenue. The easiest way is to log into your revenue online account (myAccount).

For 2022-2025 you must complete a tax return and receive a refund.

For 2026 and future years, you can add the credit to your tax credit certificate to claim the tax relief through your payroll. If you do not add it to your tax credit certificate, you can also claim at year end by completing a tax return and you will be refunded in a lump sum.

What information do you need?

Minimum information required to avail of the rent credit includes:

  • Rental address including Eircode
  • Name of the landlord or agency acting on their behalf
  • Gross Rental payments made in a calendar year
  • When claim is for a child, PPSN, date of birth, and the details and start date of approved course of child.
  • Start and estimated end date of the tenancy

While Revenue do not require the following information up front to claim the credit, the claimant should have it to hand (as well as supporting documents), as Revenue can request it at any time and revoke the credit if it is not provided by the claimant.

  • RTB registration number
  • Purpose of the tenancy
  • Confirmation if claimant is making use of the property themselves or claiming for rental payments made on behalf of a child
  • Nature of any family relationship between the tenant and landlord
  • Address, residency status and PPSN of landlord
  • Name of the person to whom the rent payment was made if different to landlord or agent
  • LPT property ID of rented property

Want to learn more and understand how Cornmarket can help? At Cornmarket, we take the hassle out of tax. Talk to one of our tax advisors today to learn more about the Cornmarket Tax Return Service.

Call us on (01) 420 6757 today.

 

Cornmarket Group Financial Services Ltd. is regulated by the Central Bank of Ireland.