Mortgage Interest Relief (MIR)
The Government has fulfilled its commitment in the Programme for Government to increase mortgage interest relief to 30% for first-time buyers who purchased homes between 2004 and 2008.
- As a result of this measure all MIR claimants who purchased for the first time between 2004-2008 will benefit from an increase in the level of mortgage interest relief that they receive in the period 2012 to 2017.
- It is estimated that this measure will cost €52 million per annum
The effects of this measure are demonstrated below:
Single and Married couples who purchased their first home between 2004 – 2008
Year of Purchase |
Maximum Relief in 2012 |
Maximum Gain |
Maximum Gain (per month) |
|
Existing |
Proposed |
|||
2004 |
€450/€900 |
€900/€1,800 |
€450/€900 |
€37/€75 |
2005 |
€450/€900 |
€900/€1,800 |
€450/€900 |
€37/€75 |
2006 |
€2,000/€4,000 |
€3,000/€6,000 |
€1,000/2,000 |
€83/€167 |
2007 |
€2,000/€4,000 |
€3,000/€6,000 |
€1,000€2,000 |
€83/€167 |
2008 |
€2,250/€4,500 |
€3,000/€6,000 |
€750/€1,500 |
€63/€125 |
Details:
Those who purchased their first home in 2004:
- Individuals who took out qualifying loans in 2004 as first-time buyers will receive a maximum gain of €450 per annum for single and €900 per annum for married. This will bring their total maximum relief to €900/€1,800 per annum for single/married.
- These mortgage holders are now receiving relief at non-first-time buyer rates (7 year rule).
- They would have received relief in 2012 at a rate of 15% on ceilings of €3,000 for single and €6,000 for married. However, as result of this measure they will now receive relief in 2012 at rate of 30% on ceilings of €3,000/€6,000 for single/married respectively.
They will benefit from this increased rate of relief until 2017 which is demonstrated in the table below:
Single and Married Couples who purchased their First Home in 2004
Year |
Status |
Ceiling |
Current Rate |
Proposed Rate |
Maximum Current Relief |
Maximum Proposed Relief |
Maximum Gain |
2012 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2013 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2014 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2015 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2016 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2017 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
Those who purchased their first home in 2005:
- Individuals who took out qualifying loans in 2005 as first-time buyers will receive a maximum gain of €450 per annum for single and €900 per annum for married. This will bring their total maximum relief to €900/€1,800 per annum for single/married.
- These mortgage holders will now receiving relief at non-first-time buyer rates in 2012 (7 year rule).
- They would have received relief in 2012 at a rate of 15% on ceilings of €3,000 for single and €6,000 for married. However, as result of this measure they will now receive relief in 2012 at rate of 30% on ceilings of €3,000/€6,000 for single/married respectively.
- They will benefit from this increased rate of relief until 2017 which is demonstrated in the table below:
Single and Married Couples who purchased their First Home in 2005
Year |
Status |
Ceiling |
Current Rate |
Proposed Rate |
Maximum Current Relief |
Maximum Proposed Relief |
Maximum Gain |
2012 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2013 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2014 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2015 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2016 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2017 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
Those who purchased their first home in 2006:
- Individuals who took out qualifying loans in 2006 as first-time buyers will receive a maximum gain in 2012 of €1,000 for single and €2,000 for married. This will bring their total maximum relief in 2012 to €3,000/€6,000 for single/married respectively.
- These mortgage holders will continue to receive relief on the increased ceilings for first-time buyers in 2012 of €10,000/€20,000 for single/married respectively.
- In 2013 these mortgage holders will be entitled to the increased rate of relief on non-first-time buyer ceilings (7 year rule)
- They will benefit from this increased rate of relief until 2017 which is demonstrated in the table below:
Single and Married Couples who purchased their First Home in 2006
Year |
Status |
Ceiling |
Current Rate |
Proposed Rate |
Maximum Current Relief |
Maximum Proposed Relief |
Maximum Gain |
2012 |
FTB |
€10k/€20k |
20% |
30% |
€2000/€4000 |
€3000/€6000 |
€1000/€2000 |
2013 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2014 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2015 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2016 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2017 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
Those who purchased their first home in 2007:
- Individuals who took out qualifying loans in 2007 as first-time buyers will receive a maximum gain in 2012 and 2013 of €1,000 for single and €2,000 for married. This will bring their total maximum relief in 2012 and 2013 to €3,000/€6,000 for single/married respectively.
- These mortgage holders will continue to receive relief on the increased ceilings for first-time buyers in 2012 and 2013 of €10,000/€20,000 for single/married respectively.
- In 2014 these mortgage holders will be entitled to the increased rate of relief on non-first-time buyer ceilings (7 year rule)
- They will benefit from this increased rate of relief until 2017 which is demonstrated in the table below:
Single and Married Couples who purchased their First Home in 2007
Year |
Status |
Ceiling |
Current Rate |
Proposed Rate |
Max Current Relief |
Max Proposed Relief |
Maximum Gain |
2012 |
FTB |
€10k/€20k |
20% |
30% |
€2000/€4000 |
€3000/€6000 |
€1000/€2000 |
2013 |
FTB |
€10k/€20k |
20% |
30% |
€2000/€4000 |
€3000/€6000 |
€1000/€2000 |
2014 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2015 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2016 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2017 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
Those who purchased their first home in 2008:
- Individuals who took out qualifying loans in 2008 as first-time buyers will receive a maximum gain in 2012 of €750 for single and €1,500 for married. This will bring their total maximum relief in 2012 to €3,000/€6,000 for single/married respectively.
- In 2013 and 2014 they will receive a maximum gain of €1,000 for single and €2,000 for married. This will bring their total maximum relief in 2013 and 2014 to €3,000/€6,000 for single/married respectively.
- These mortgage holders will continue to receive relief on the increased ceilings for first-time buyers in 2012, 2013 & 2014 of €10,000/€20,000 for single/married respectively.
- In 2015 these mortgage holders will be entitled to the increased rate of relief on non-first-time buyer ceilings (7 year rule)
- They will benefit from this increased rated of relief until 2017 which is demonstrated in the below:
Single and Married Couples who purchased their First Home in 2008
Year |
Status |
Ceiling |
Current Rate |
Proposed Rate |
Max Current Relief |
Max Proposed Relief |
Maximum Gain |
2012 |
FTB |
€10k/€20k |
22.5% |
30% |
€2250/€4500 |
€3000/€6000 |
€750/€1500 |
2013 |
FTB |
€10k/€20k |
20% |
30% |
€2000/€4000 |
€3000/€6000 |
€1000/€2000 |
2014 |
FTB |
€10k/€20k |
20% |
30% |
€2000/€4000 |
€3000/€6000 |
€1000/€2000 |
2015 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2016 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
2017 |
Non FTB |
€3k/€6k |
15% |
30% |
€450/€900 |
€900/€1,800 |
€450/€900 |
Qualifying loans taken out in 2012
- Individuals who take out qualifying loans in 2012 as first-time buyers will now receive relief at a rate of 25% on ceilings of €10,000 per annum for single and €20,000 per annum for married couples. This will give a maximum relief in 2012 of €2,500 for single and €5,000 for married. This is a gain of €2,050 and €4,100 on what would have applied.
- Non-first-buyers who take out qualifying loans in 2012 will continue to receive relief at a rate of 15% on ceilings of €3,000 for single individuals and €6,000 for married couples. This will give a maximum relief in 2012 of €450 for single and €900 married. This is a gain of €150 and €300 on what would have applied.
- The previous Government had legislated for qualifying loans taken out in 2012 would receive the relief at reduce rate of 15% for first time buyers and 10% for non-first-time buyers with a common ceiling of €3,000 for single individuals and €6,000 for married couples. However, the current system of relief will now be extended for anyone taking out qualifying loans in 2012.
- It is estimated that it will cost €5 million per annum to extend the current system of relief to 2012.
- Loans taken out in 2013 will not qualify for mortgage interest relief.
- The changes to rates and ceilings for those who purchased in 2012 is demonstrated below:
Single and Married Couples taking out a qualifying loans in 2012 as a First Time Buyers
Year |
Current Ceiling |
Proposed Ceiling |
Current Rate |
Proposed Rate |
Maximum Current Relief |
Maximum Proposed Relief |
Maximum Gain |
2012 |
€3k/€6k |
€10k/€20k |
15% |
25% |
€450/€900 |
€2500/€5000 |
€2050/€4100 |
2013 |
€3k/€6k |
€10k/€20k |
15% |
25% |
€450/€900 |
€2500/€5000 |
€2050/€4100 |
2014 |
€3k/€6k |
€10k/€20k |
15% |
22.5% |
€450/€900 |
€2250/€4500 |
€1800/€3600 |
2015 |
€3k/€6k |
€10k/€20k |
15% |
22.5% |
€450/€900 |
€2250/€4500 |
€1800/€3600 |
2016 |
€3k/€6k |
€10k/€20k |
15% |
22.5% |
€450/€900 |
€2250/€4500 |
€1800/€3600 |
2017 |
€3k/€6k |
€10k/€20k |
15% |
20% |
€450/€900 |
€2000/€4000 |
€1550/€3100 |
Single and Married Couples taking out a qualifying loans in 2012 as a Non-First-Time Buyers
Year |
Current Ceiling |
Proposed Ceiling |
Rate |
Proposed Rate |
Maximum Relief |
Maximum Proposed Relief |
Maximum Gain |
2012 |
€3k/€6k |
€3k/€6k |
10% |
15% |
€300/€600 |
€450/€900 |
€150/€300 |
2013 |
€3k/€6k |
€3k/€6k |
10% |
15% |
€300/€600 |
€450/€900 |
€150/€300 |
2014 |
€3k/€6k |
€3k/€6k |
10% |
15% |
€300/€600 |
€450/€900 |
€150/€300 |
2015 |
€3k/€6k |
€3k/€6k |
10% |
15% |
€300/€600 |
€450/€900 |
€150/€300 |
2016 |
€3k/€6k |
€3k/€6k |
10% |
15% |
€300/€600 |
€450/€900 |
€150/€300 |
2017 |
€3k/€6k |
€3k/€6k |
10% |
15% |
€300/€600 |
€450/€900 |
€150/€300 |
Source: Department of Finance. www.finance.gov.ie
