Home Renovation Incentive
What is it?
The Home Renovation Incentive (HRI) scheme 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 the Homeowner’s main home by qualifying Contractors.In general, qualifying work must be done between 25 October 2013 and 31 December 2015.
Who can claim it?
Owner occupiers, who pay Income Tax under PAYE or self assessment and whose Local Property Tax and Household Charge obligations are up to date, are eligible. The Homeowner must be on Revenue’s Local Property Tax Register as an Owner or joint Owner of the main home.
What type of work qualifies?
If you are having your septic tank repaired or replaced, or are installing a radon gas mitigation solution, these types of work also qualify for the HRI. Work on driveways and on rainwater harvesting systems can also qualify
- Examples of repair, renovation or improvement works that qualify under the Incentive include –
- Painting and decorating
- Rewiring
- Tiling
- Supply and fitting of kitchens
- Extensions
- Garages
- Landscaping
- Supply and fitting of solar panels
- Conservatories
- Plastering
- Plumbing
- Bathroom upgrades
- Supply and fitting of windows
- Attic conversions
- Driveways
- Septic tank repair or replacement
- Central heating system repair or upgrade
- Supply and fitting of built in wardrobes
The VAT rate on works carried out must be 13.5%.
What work doesn’t qualify for the HRI?
Work that is subject to VAT at 23% (such as architect’s fees) is not covered. Neither are items such as furniture, white goods or carpets or any of the following:
- Rental properties or holiday homes
- New builds
- A complete reconstruction of an uninhabitable house.
If you are unsure about whether your works will qualify contact us and we can assist.
How much must I spend?
The qualifying work must cost at least €4,405 before VAT at 13.5%, which adds to a total of €5,000 with VAT included. You will only get the tax credit in relation to a maximum of €30,000 (before VAT) during the 2 years covered by the HRI.
The minimum credit is €595, based on the minimum qualifying expenditure of €4,405. The maximum is €4,050, based on the maximum qualifying expenditure of €30,000.
If you are claiming a grant for the works, or if they are covered by an insurance claim, the amount of your expenditure that qualifies for HRI will be reduced.
How do I claim this credit?
This is an excellent relief not to be missed by taxpayers performing improvement works. Further to this any unused tax credit can be rolled over into the following year. 2015 will be the first year in which you can claim a HRI credit.
Speak to a member of the Tax Advice team in CPC & Co if you think you qualify and we can assist with obtaining your credit.
