Home renovation tax break to boost construction
Home Renovation Initiative HRI scheme will incentivise domestic renovations and increase demand for small construction jobs
Home Renovation Incentive HRI scheme
Finance (No 2) Bill 2013 provides for a Home Renovation Incentive HRI scheme, which will run from 25 October 2013 to 31 December 2015. The Incentive provides for tax relief for Homeowners by way of an Income Tax credit at 13.5% of qualifying expenditure on repair, renovation or improvement works carried out on a main home by qualifying Contractors.
Qualifying expenditure is expenditure subject to the 13.5% VAT rate.
The works must cost a minimum of €4,405 (before VAT), which will attract a credit of €595. Where the cost of the works exceeds €30,000 (before VAT), a maximum credit of €4,050 will apply.
The credit is payable over the two years following the year in which the building work is carried out and paid for. 2015 will be the first year for HRI tax credits.
The works must be carried out on or after 25 October 2013 and up to 31 December 2015. Homeowners must be Local Property Tax compliant in order to qualify under the Incentive while Contractors must be VAT registered and tax compliant in order to qualify to carry out works under the HRI.
While systems have yet to be developed, the Incentive will be administered through Revenue’s online systems. All works, payments and claims will be registered electronically with Revenue.
Read more on the Revenue website