Supports for self-builders extended

Budget 2021 extends both the Help to Buy scheme and stamp duty refunds for one year.

The Help to Buy Incentive, the tax refund introduced in ROI in 2016, is now open to applicants up to the 31st of December 2021.

The scheme which helps first time self-builders, and first time buyers of a new home, put down a deposit to secure a mortgage, was due to expire at the end of 2020.

Help to Buy allows self-builders to claim up to €30,000 or 10 per cent of the house value when completed, whichever is the lesser, in a tax refund.

These amounts were increased in July from €20,000, or 5 per cent of the purchase price. The application process will continue as before, with self-builders requiring a solicitor to administer it.

Stamp duty

Stamp duty, which is the tax levied on property (house or land) transactions, currently applies at a 7.5 per cent rate on non-residential land in ROI. This is the rate applicable if you buy a greenfield site that hasn’t been earmarked for development yet.

Revenue introduced a refund in 2017 to bring the effective rate down to a minimum of 2 per cent when the land is converted for residential use. The stamp duty rate for residential property stands at 1 per cent.

For one-off houses the rebate only applies to one acre of land and you must build on at least 75 per cent of the area of the site.

This relief was due to expire and has been extended for a year, in that you had to start building by the end of 2021 to qualify. Now you have until the end of 2022 to start, with a completion date of 30 June 2025 at the latest.

The Department of Housing had recommended scrapping the stamp duty refund for self-builders and restyling it to encourage apartment complexes on brownfield sites in city centres.

The Department of Finance, however, argued the “provision of housing is not solely an urban issue” and that the scheme should continue to apply to all forms of housing, including once off houses, a position that was adopted for the budget.

According to Revenue figures, as of the end of September 2020, even though 92 per cent of the stamp duty relief applications were for self-builds they only represented 25 per cent of the total amount refunded.

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