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Home Renovation Grant Tax Incentive

The Home Renovation Grant Tax Incentive Scheme is now live. You can now receive a substantial amount of money back on works carried out in your home. Revenue have launched their online portal and it all seems to be running smoothly.

Due to successful lobbying by groups such as the Construction Industry Federation and other interested parties, the date has been brought forward (originally planned for January 2014) and the Renovation Grant scheme came into effect on 25th October 2013. This eliminates the need for Home Owners to postpone Home Improvement projects until January which would cause a mini-downturn in an already delicate industry. We believe the benefits of the incentive will have multiple positive effects for industry, the exchequer and society as a whole.

Legitimate contractors will now be able to compete with rogue traders which in turn will benefit the exchequer in the form of tax receipts. Only tax compliant contractors can participate in the Renovation Grant scheme. This move is widely welcomed as one the biggest single measures to combat tradesmen & companies that are non tax compliant.

Why not avail of works like a new and have the Government reward you??

So what does this mean for Home Owners wishing to avail of the Renovation Grant incentive? From now on, Extensions, Plumbing, Electrical & Plasterwork will be included in the scheme and once the value of the contract is over €5,000 and under €30,000 (ex. Vat) home owners can apply for tax credits of 13.5%. Materials must be supplied by the contractor, presumably to ensure that all elements of the work carried out is traceable for tax purposes.

Items covered under any other grant system such as insulation & adaptation grants do not qualify for the Home Improvement Tax Incentive Scheme.

Revenue have provided the following information:

The Home Renovation Incentive provides a tax credit for homeowners (owner-occupiers) for qualifying expenditure incurred on repair, renovation or improvement work carried out on their principal private residence.

Qualifying conditions:

The work must carried out on or after 25 October 2013 and on or before 31 December 2015.

If planning permission is required and is in place by 31 December 2015, then payments made in respect of qualifying work carried out between 1 January 2016 and 31 March 2016 will qualify under the incentive.

Payments for qualifying work which are made between 25 October 2013 and 31 December 2013 will be treated as if they were made in 2014.

Qualifying works must cost a minimum of €5,000 (including VAT at 13.5%). The €5,000 can be made up of a number of payments to different qualifying contractors.

There is no upper limit on the cost of the works but the maximum amount on which relief can be claimed is €30,000 (before VAT).

The tax credit will be 13.5% of the cost of the works (before VAT), subject to the minimum and maximum amounts. It will be included on your Tax Credit Certificate or Income Tax Notice of Assessment and will be given over a 2 year period following the year in which payment is made for the qualifying work.

Homeowners must be LPT and Household charge compliant in order to qualify while building contractors must be VAT registered and tax compliant in order to carry out works.