TRS - should this have happened???

bungaro

hi,
just checked my online banking there and the fortnightly mortgage payment was taken out as usual. however the mortgage interest relief has gone down €35 since the last payment. its our first mortgage so i thought that basically nothing was supposed to change in the first 7 years so whats after going on?!?! i assume it something to do with the new year but this was totally unexpected!!

chris85

bungaro wrote: »

hi,
just checked my online banking there and the fortnightly mortgage payment was taken out as usual. however the mortgage interest relief has gone down €35 since the last payment. its our first mortgage so i thought that basically nothing was supposed to change in the first 7 years so whats after going on?!?! i assume it something to do with the new year but this was totally unexpected!!

http://www.citizensinformation.ie/categories/housing/owning-a-home/buying-a-home/mortgage_interest_relief

Looks like it drops going into 3rd year of the mortgage. would tha sound about right?

bungaro

hi chris,
we're about 14 months into the mortgage so really don't know why its after going down. will ring revenue but am wondering if anyone else is in the same position???

rainbowtrout

From the Revenue site:
http://www.revenue.ie/en/press/budget/2009/supplementary/mortgage-interest-relief.html

However, mortgage interests tax relief may be claimed on the interest paid on a qualifying home loan in the first 7 tax years of the life of that loan.

the rate at which tax relief is given to first-time buyers is -
25 per cent for tax years 1 and 2;
22.5 per cent for tax years 3, 4 and 5; and
20 per cent for tax years 6 and 7, and
the rate at which tax relief is given to non-first-time buyers is 15%

If I'm reading this correctly it's based on tax years not on the date you started your mortgage so if you've been paying the mortgage for 14 months, you took it out in November 2008. So that's 2008,2009,2010 and you're now in the third tax year for which you are entitled to relief. It doesn't seem to matter when in 2008 you took out the mortgage, it's counted as a tax year.

I could be completely wrong on this, so someone feel free to correct me.

rameire

rainbowtrout wrote: »

From the Revenue site:
http://www.revenue.ie/en/press/budget/2009/supplementary/mortgage-interest-relief.html





If I'm reading this correctly it's based on tax years not on the date you started your mortgage so if you've been paying the mortgage for 14 months, you took it out in November 2008. So that's 2008,2009,2010 and you're now in the third tax year for which you are entitled to relief. It doesn't seem to matter when in 2008 you took out the mortgage, it's counted as a tax year.

I could be completely wrong on this, so someone feel free to correct me.

you are completely correct.

g021283

hi guys....i have a mortgage with almost 3 yrs....on a 3 yr fixed rate....just got a letter from first active(ulster) saying in accordance with notification received from the revenue, your new annual trs is in effect.....i have to pay almost 100 euro extra a month....did i miss something in the budget.....to be honest i wasnt paying that much attention to it. but im interested now alright!!!

Toots

Threads merged.

bungaro

rainbowtrout wrote: »

From the Revenue site:
http://www.revenue.ie/en/press/budget/2009/supplementary/mortgage-interest-relief.html





If I'm reading this correctly it's based on tax years not on the date you started your mortgage so if you've been paying the mortgage for 14 months, you took it out in November 2008. So that's 2008,2009,2010 and you're now in the third tax year for which you are entitled to relief. It doesn't seem to matter when in 2008 you took out the mortgage, it's counted as a tax year.

I could be completely wrong on this, so someone feel free to correct me.

thanks rainbowtrout, that makes sense what you're saying, might ring them anyway just to confirm

Iago

It changes on the basis of total interest that you're expected to pay over the course of a year.

If the interest rate drops then your TRS could drop accordingly, similarly if the interest rate increases then your TRS could increase once you're still under the maximum of course.