Mortgage Interest Relief - Dec 31st Cut-Off - Self Build

ShiverinEskimo

I'm just after starting my self-build and was about to draw down our first amount. My mortgage broker just called me to say we need to draw down as much as possible before December 31st as mortgage interest relief will only apply on what was drawn down prior to this date - which he perceived as a major shifting of the goal posts by the Revenue. Until now it was assumed anyone who made a repayment and qualified for interest relief would continue to do so into 2013 as the rest is drawn down.

The Revenue site uses very vague terminology in that they say "taken out" instead of 'approved' or 'drawn down' or the various other states a mortgage can be.

A mortgage taken out from 1st January 2004 to 31st December 2012, used to purchase, repair, develop or improve your sole or main residence, situated in the State eligible for mortgage interest relief until 31st December 2017 (see rates/ceilings chart). Mortgages taken out after 31st December 2012 will not qualify for mortgage interest relief.

I've emailed the revenue for clarification on both points - if/when I receive a reply I'll post up what I can.

Can anyone confirm/deny any of the above in the mean time?

dos30

Hi ShiverinEskimo,

I'm in the same position as you, making our first drawdown at the moment.
Did you get any reply from revenue?

ShiverinEskimo

Weirdly I got a reply this morning. Pretty much confirms "taken out" applies only to 'drawn down'.

refer to your email on mortgage interest relief via Louth PAYE Revenue District.


Under existing criteria mortgages taken out before 31 December 2012 subject to qualifying loan criteria, are eligible for mortgage interest relief until 31st December 2017. Mortgages taken out after 31st December 2012 will not qualify for mortgage interest relief. It is necessary for the drawdown to take place before 31 December 2012 to qualify for mortgage interest relief. Mortgage interest relief is due to cease with effect from January 2018. As regards a "self-build", tax relief is available in respect of interest paid on a qualifying loan taken out on or after 1 January 2004 and on or before 31 December 2012 to build a qualifying residence. Taken out prior to 31 December 2012 means "drawn down" and used on the qualifying residence (e.g purchase of site plus building costs) before that date. The mortgage interest relief entitlement relates to relief on the portion of the loan that is drawn down in 2012. The application for mortgage interest relief can be made once the first repayment has been made. You can complete your application for Mortgage Interest Relief online on Revenue website (www.revenue.ie) at: Home - Online Services - Mortgage Interest Relief - Register. Please note it is essential that the correct mortgage account number is used in the application.

Hope this clarifies the position and please do not hesitate to contact me if you have any further query.



Yours sincerely

TRS Section

Sickened.

In the process of drawing down as I type. Hoping to get a second one done before christmas. Thankfully the weather has been favourable for building so it's going very quickly.

dos30

Sorry for reopening an old thread, but I'm in the middle of applying for Mortgage Interest Relief on a self build.
I had presumed I was only entitled to interest relief on money drawn down before 31st Dec 2012, but came across this on the revenue site.

What is the position with loan stage payments which were used to purchase a site and build a home where a stage payment was received in 2012, and further stage payments have or will be provided again in 2013?

Where a loan was taken out and used by an individual to purchase a site between 1 January 2012 and 31 December 2012 any stage payments taken out in 2013 for the construction of a principal private residence on that site will qualify for relief provided any necessary planning permission was granted in 2012 and still remains in place.

http://www.revenue.ie/en/tax/it/leaflets/tax-relief-source-mortgage-interest-relief.html#section11


Have any of you come across this before and has anyone got interest relief on stage payments drawn down in 2013?

ShiverinEskimo

We didn't buy our site - was a gift from her parents. So not sure this applies to us. I'll have my mortgage advisor check it out though.

dos30

We're similar, bought the site from savings.
I'm going through the "Νοtes for Guidance – Taxes Consolidation Act 1997 – Finance Act 2013 Edition - Part 8" document (Extract below) and am still thinking we might qualify for relief on payments drawn down in 2013??

Certain loans taken out in 2012 and 2013
Interest relief is available for the tax years 2013 to 2017, in respect of interest paid on
a loan taken out and used by an individual;
• (7)(a) on or after 1 January 2012 and on or before 31 December 2012 to purchase a site on which his or her home is to be constructed; or
• (7)(b) on or after 1 January 2012 and on or before 31 December 2013 to construct the said home on that site.

(8) Interest relief is available for the tax years 2013 to 2017, in respect of interest paid on
a loan for which loan approval in writing was in place on or after 1 January 2012 and
on or before 31 December 2012; and

• (8)(a) part of the loan was used in 2012 by that individual to repair, develop or
improve his or her home, and

• (8)(b) the balance of the loan was used in 2013 by that individual to repair, develop
or improve his or her home.

(9) This subsection deems the loans in subsection (7) and (8)(b) to be qualifying loans
taken out in 2012.

Relief shall not be granted in respect of interest paid on any loan to which subsection
(7) or (8) applies unless the required Planning Permission was granted on or before
31 December 2012 and such Permission has not ceased to exist.

Duffers11

Hi, sorry to re-open thread but was wondering of any1 has had any recent up to date knowledge on this. I received planning permission and took out a mortgage in May 2012 for which I made draw downs, however I made a rather significant draw down this year with 1 more and final draw down to go. i had been paid relief on full mortgage until this week where I received notification from the lovely Revenue that i should not have been receiving trs on funds drawn down this year. The site was purchased by my parents in 2012 and gifted to me in the same transaction as such. Can any1 advise if I am flogging a dead horse here. It seems that they will only give relief on fundsdrawn in 2013 if you can prove you used some of the funds to purchase the site. Seems pretty unfair , I think it shouldnt matter if you bought a house or built a house as long as the mortgage was granted in 2012, surely one should be entitled to trs. The one little give back you get from the Revenue is now gone...like everything I suppose!! So frustrating!!:mad:Anyway, any advice/experience of this matter would be greatly appreciated!

dos30

I'd try ringing the trs department and quote from page 19 on this http://www.revenue.ie/en/practitioner/law/notes-for-guidance/tca/part08.pdf
sections 8 & 9

(8) Interest relief is available for the tax years 2013 to 2017, in respect of interest paid on
a loan for which loan approval in writing was in place on or after 1 January 2012 and
on or before 31 December 2012; and

• (8)(a) part of the loan was used in 2012 by that individual to repair, develop or
improve his or her home, and

• (8)(b) the balance of the loan was used in 2013 by that individual to repair, develop
or improve his or her home.

(9) This subsection deems the loans in subsection (7) and (8)(b) to be qualifying loans
taken out in 2012.

Duffers11

dos30 wrote: »

I'd try ringing the trs department and quote from page 19 on this http://www.revenue.ie/en/practitioner/law/notes-for-guidance/tca/part08.pdf
sections 8 & 9

(8) Interest relief is available for the tax years 2013 to 2017, in respect of interest paid on
a loan for which loan approval in writing was in place on or after 1 January 2012 and
on or before 31 December 2012; and

• (8)(a) part of the loan was used in 2012 by that individual to repair, develop or
improve his or her home, and

• (8)(b) the balance of the loan was used in 2013 by that individual to repair, develop
or improve his or her home.

(9) This subsection deems the loans in subsection (7) and (8)(b) to be qualifying loans
taken out in 2012.

Hey,

Thanks so much for this response. I provided a copy of the planning permission and mortgage offer letter and quoted what you advised and it appears to have worked, they advised that they are now amending my qualification back to 100%. Thanks a mill for the advice, much appreciated!!

sporty14

Hello. Was reading your message. We took out a mortgage and drew down a part in 2012 and drew down the rest in 2013. We were recently told we would not qualify for the full relief and only for what was drawn down in 2012!! Disaster. We were also gifted the site as you were. Can you offer us any advise as to how you overcame the issues you had, as they are very similar to ours.
Many thanks in advance.

Duffers11

sporty14 wrote: »

Hello. Was reading your message. We took out a mortgage and drew down a part in 2012 and drew down the rest in 2013. We were recently told we would not qualify for the full relief and only for what was drawn down in 2012!! Disaster. We were also gifted the site as you were. Can you offer us any advise as to how you overcame the issues you had, as they are very similar to ours.
Many thanks in advance.

Hi there, it's a nightmare dealing with issues such as this. You are entitled to trs in full if you have a self build mortgage and have drawn down funds in 2012 and 2013. You will need to either show that you received planning permission on the said site in 2012 to which I had and provided a copy of same along with my mortgage offer letter. I didn't provide anything to say that I used some of the mortgage to buy the land as I didn't. I also quoted what the previous poster said and it seemed to work!! Their law on this is very loose to say the least! Good Luck

Augusta11

Hi Guys,

We are also having the same issue with Revenue regarding them not allowing us to claim for TRS on our Mortgage draw downs in 2013. Like some of the posters above, we also started a self build in 2012 on a site that was gifted to my Wife by her parents.
We have been emailing Revenue over the last couple of weeks as our TRS was reduced from 100% to 48%. ( as we had drawn down slightly more than half our mortgage in 2013 )
This reduction in TRS only began in the 3 months to date this year. Up until the end of 2013 we were receiving full TRS relief on our mortgage monthly payments.

REVENUE quoted this to us:
The Finance Bill 2013 inserts four new subsections into Section 244 of the Taxes Consolidation Acc 1997. Under section 7 a stage payment loan will fully qualify for relief if 4 conditions are met. These are 1). A loan must have been taken out between 1st January 2012 and December 31st 2012. 2). A portion of the loan must have been used to purchase a site in 2012. 3) The balance of the loan must be drawn down and used to construct a dwelling on that site in 2012 and 2013. 4). Any necessary planning permission must have been in place prior to 31st December 2012. If you could attach proof off all these conditions being met


When we replied with the proof we were told we met 3 out of the 4 conditions but as we did not buy the site with part of our Mortgage loan we are not qualified to claim the TRS relief for the 2013 drawdowns.

Can any of you advise what we can do next? Apart from Duffers11 has anybody else who built on a site gifted to them received the full TRS relief or for that matter been refused the full TRS relief?

Thanks for any help or advise, Cheers Augusta

psmb

Hi Augusta11

Did you manage to make any progress on this. I am in the same situation where revenue have cut off my TRS for anything drawn down in 2013. They are saying we do not qualify as we did not purchase our site.

We got our planning in 2012, drew down and used part of our mortgage in 2012 but were gifted the site.

I believe we still might qualify under the below condition but revenue are disputing what "develop" means. They are saying develop does not mean build a house.

• (8)(a) part of the loan was used in 2012 by that individual to repair, develop or
improve his or her home, and

• (8)(b) the balance of the loan was used in 2013 by that individual to repair, develop
or improve his or her home.

Augusta11

Hi PSMB,

No unfortunately we've had no joy with arguing our case to Revenue. Our circumstances are pretty much identical to yours. Revenue will not allow us to claim the TRS relief for our 2013 drawdowns purely on the basis that we did not use part of our mortgage to purchase the site.

We were emailing them back and forward, then asked for a Supervisor to ring us, we explained the whole situation but it has been no use, we may as well been talking to the wall.

We made an official written complaint to the Ombudsman but basically the reply we got from them was to try to sort it out with Revenue ourselves and if not, then we could complain again using their official complaint form.

We have since written to Revenue to make an official complaint to them and have quoted numerous statements from the Revenue website that would outline why we feel we should be entitled to this TRS relief. We have also argued that our house build can easily be classified as a development as that is how it is described in our planning permission. We had to pay a very large amount of money in DEVELOPMENT Contribution Levies which I'm sure you would have done also, so we are hoping Revenue might see that common sense should prevail but its not looking likely at the moment.

Its strange how some people in the same situation as ours has been able to claim the TRS ( and rightfully so ) but more like us have not been able to.

It really is completely unfair.

I will post an update if and when Revenue come back to us.

I wish you luck on this very stressful matter.


Cheers, Augusta

psmb

Hi Augusta,

I am not making much progress with revenue either. They are very hard to deal with.
I believe they are using the wording of the legislation to exclude people who did not purchase a site when the legislation, I believe was put in place to ensure people who purchased a site but had not started work would be included.

I have found the following guidelines relating to Residence under construction on the revenue website (cant post link as im a newbie)

[8.3.8] Relief for interest paid on certain home loans
Section 244, 244A and 245 TCA 1997
Last updated November 2012


Paragraph 14 discusses Residence under construction and states the following :

in the case of a first-time house purchaser, the residence may be accepted as the
individual’s sole or main residence with effect from the date of purchase of the site or, if
later, the date planning permission for the construction of the residence is granted BUT
if the individual does not wish to claim relief until the house is completed and occupied,
then the first time buyer relief can commence when the house is occupied;

This would mean that our site became our sole or main residence once planning permission was granted on the site in 2012.

The Notes for Guidance – Taxes Consolidation Act 1997 – Finance (No.2) Act 2013 Edition - Part 8 states the following.

Certain loans taken out in 2012 and 2013

Interest relief is available for the tax years 2013 to 2017, in respect of interest paid on a loan for which loan approval in writing was in place on or after 1 January 2012 and on or before 31 December 2012; and
(8)
 part of the loan was used in 2012 by that individual to repair, develop or improve his or her home, and
(8)(a)
 the balance of the loan was used in 2013 by that individual to repair, develop or improve his or her home.
(8)(b)
This subsection deems the loans in subsection (7) and (8)(b) to be qualifying loans taken out in 2012.

Our loan was taken out in 2012 to develop our site which was our home\our sole or main residence once planning was granted. The balance of the loan was drawn down and used in 2013 to develop our home\our sole or main residence.

I believe this qualifies the portion of our loan drawn down in 2013 for mortgage interest relief.

I have sent this info to revenue and our case is been reviewed. I am waiting to hear back, as I said they are very hard to deal with. They will not admit that we have a case.
I will be talking to my local representative on the issue later today and also will be talking to a tax consultant.

I will post back with any updates.

psmb

Hi Hi Augusta,

Regarding your point about your house been classified as a development, Revenue have tried to tell me that the building of a house is not a development (unreal). I have taken the following info from our local county council website and sent this to Revenue.

1. When do I need planning permission?
Generally, you need planning permission for any
development of land or property unless the development is
specifically exempted from this need. Development includes
the carrying out of works (building, demolition, alteration)
on land or buildings and the making of a material (i.e.
significant) change of use of land or buildings.

This clearly shows that a new build is a development which qualifies us for TRS, of course revenue have not admitted this yet and we are still waiting to get our interest relief reinstated.

At this point I have involved some local representatives and contacted the department of finance. I suggest you do the same.
What revenue are doing here is out of line, cutting people off without any notification and then ignoring information been provided to them which shows people should not have been cut off.

Augusta11

Hi PSMB,

Thanks for passing on your update, I really appreciate it.

We are waiting a reply from Revenue to a letter we sent them last week. On our latest letter we have emphasised our self build as a development. We also attached a copy of our Development Contribution Levy payment and also a copy of our Planning Permission approval both of which came from our local county council. On both of these copies it clearly referers to our house build as "The Development" and this is mentioned on numerous occasions throughout the Planning Permission approval.

We can only hope that Revenue will see sense and amend our Trs relief. We shouldn't have to be jumping through hoops to satisfy Revenue. The fact our mortgage loans were in place and drawn down in 2012 and 2013 for the sole purpose of building our homes should have been enough to claim our full Trs but as they are using the wording of the legislation to exclude us then we have to do exactly the same and emphasise our Developments are entitled to full Trs due to the wording of the exemption in the legislation.

We will await their response and then contact our local TDs to take the matter further if necessary.

We can only hope that we along with others in the same situation have made Revenue realise their error in reducing our Trs entitlements.

I will post an update when Revenue reply to us.


Cheers,
Augusta

ErnieElly

I only came across this thread today.
Our MIR was cut by 153e in Jan without any notification which was a big shock to us! When I rung up they said we were only entitled to the MIR on the amount drawn down in 2012.

We had our planning approved in 2012 and first drawdown in Dec 2012 to purchase the house and completed drawdowns in 2013 for extension and renovation

When I rung them today to query after reading this thread, they said an enquiry had been sent to our lender on 26th of this month to confirm all documents were in place and correct in 2012 and she told me to ring back in a month. They were reviewing our case, funny how all this goes on in the background and we know nothing about it!

So frustrating but would be great if we got back our 100% MIR so thanks all for the info, I will let ye know the outcome.

psmb

Hi ErnieElly,

It seems to me that you do qualify for MIR on 100% of your mortgage under section 8 of the legislation outlined earlier on this thread. Its unbelieveable that revenue would cut you off in Jan and then review your case 6 months later, all without informing your or getting any information from you.

I have had the following response from the minister for finance today.

In order to qualify for mortgage interest relief (MIR), a loan must have been drawn down and used in the purchase, repair or development of an individual's principal private residence on or before 31 December 2012. On this basis, any funds drawn down on a date later than 31 December 2012, do not qualify for the relief.

However, Section 9 of the 2013 Finance Act provides for extended entitlement beyond the 31 December deadline in circumstances where all of the required qualifying conditions are met. The qualifying conditions are:
1. The loan must have been taken out between 1 January 2012 and 31 December 2012,
2. A portion of the loan must have been used to purchase a site in 2012,
3. The balance of the loan must be drawn down and used to construct a dwelling on that site in 2012 and 2013.
4. Any necessary planning permission must have been in place prior to 31 December 2012.

Regarding the case to which the Deputy refers, Revenue has confirmed to me that the site in question was not purchased by the claimants during 2012, thereby 'disqualifying' the funds drawn down after 31 December 2012 from entitlement to MIR.Revenue has also confirmed to me that while the claimants are not entitled to MIR in respect of the portion of the loan drawn down after 31 December 2012, they are in receipt of MIR in respect of the portion of the loan drawn down in December 2012. This entitlement will continue up to 2017 as currently provided for under the legislation.

It looks like the revenue are providing the minister with the same misinformation that they have provided me with.
No where in any legislation that I can find and no where in any of the information that revenue provided me with does it state that all 4 conditions have to apply to one individual on order for that individual to be eligible for MIR on the portion of the mortgage drawn down after 2012. The legislation does state the following.

(9.—Section 244 of the Principal Act is amended by inserting the following after subsection (6):

“(7) This subsection shall apply to a loan taken out and used

by an individual––

(a) on or after 1 January 2012 and on or before 31 December 2012 solely for the purpose of defraying money employed in the purchase of an estate or interest in the land referred to in paragraph (b) and in respect of which the permission in subsection (10) applies but only where a residential premises, which is a qualifying residence in relation to that individual, is constructed on that land, or

(b) on or after 1 January 2012 and on or before 31 December 2013 solely for the purpose of defraying money employed in the construction of a residential premises which is a qualifying residence in relation to that individual on land––

(i) in respect of which he or she has, on or after 1 January 2012 and on or before 31 December 2012, acquired an estate or interest, and

(ii) the acquisition of which was financed by way of the loan referred to in paragraph (a).


(8) This subsection shall apply to a loan in respect of which there was in place, on or after 1 January 2012 and on or before 31 December 2012, an agreement evidenced in writing to provide that loan to an individual and––

(a) part of that loan is used in the period 1 January 2012 to 31 December 2012, and

(b) the balance of that loan is used in the period 1 January 2013 to 31 December 2013,

by that individual solely for the purpose of defraying money employed in the repair, development or improvement of a residential

premises which is a qualifying residence in relation to that individual.

I believe we qualify under part 8 as outlined above.

[8.3.8] Relief for interest paid on certain home loans
Section 244, 244A and 245 TCA 1997
Last updated November 2012

Paragraph 14 discusses Residence under construction and states the following :

in the case of a first-time house purchaser, the residence may be accepted as the
individual’s sole or main residence with effect from the date of purchase of the site or, if
later, the date planning permission for the construction of the residence is granted BUT
if the individual does not wish to claim relief until the house is completed and occupied,
then the first time buyer relief can commence when the house is occupied;


I have asked the minister to tell me how we do not qualify under section 8.
I have put the above information to the revenue weeks ago and asked them to tell me how we do not qualify under section 8. I have not had a response yet. Which tells me the revenue do not have an answer for my question. Maybe the minister for finance will have an answer.

FFM01

Hi All,

We are just in the exact same scenario as you all & are just about to start arguing with Revenue on this.

Please keep us updated with how you get on with Revenue etc.

We got our full TRS for our draw downs in 2013 up until the 1st January 2014, it is only then that Revenue started restricting us, although this was included in the Finance Act 2012.

This is incredibly unfair & is a big difference on our mortgage each month. We had only a 1/4 of our mortgage drawn down in 2012.

We intent to argue this fully with Revenue.

I will post any updates also.

ErnieElly

Looks like we are all in for a long battle ahead!

My latest phonecall with the revenue told me they are waiting on the bank to provide info that all was in place for us before 2012 - they'll be waiting I'd say.
They told me in the meantime to email in proof that the house was purchased in 2012 and proof that the drawdowns made in 2013 were used for the renovation of the house. What do they think we did with the drawdowns, sure the bank wouldnt of given us the money if it wasnt for the house.
Just so frustrating, they'd wear you down! From reading the posts here and from speaking with them numerous times, the worrying thing is that they just dont seem to know themselves.

AndNev

Hi,

Was just looking into this myself and came across this thread. Has anybody any further updates on it?

Has anyone managed to get around the point mentioned above regarding site purchase? I am looking into it for a friend who was gifted the site from his brother.

I have a couple of thoughts below which may be used as an arguement to revenue in relation to "purchase of site".

1: Although he was gifted the site a Capital Gain arose for the brother which my friend duly paid on his behalf. I wonder would this be considered a purchase as tax was paid on same even though nothing was paid for the site?

2: When I was gifted a site from mother in law earlier this year a consideration was paid of €1. I believe this is a must in all contracts. i.e. a contract must have an Offer, Consideration and Acceptance. The consideration in this instance was €1. I technically bought the site for €1. I am sure that some of you who were gifted sites would also have seen this in the transfer documentation you signed with your solicitor. Is this an arguement you could use?

Any thoughts?

Augusta11

Hi All,

Finally got a letter from Revenue in reply to the official complaint we made to them 2 months ago. They just will not budge on their stance that the site had to be purchased with part of the mortgage loan. They also will not allow our argument that our house build is a form of development which would have allowed us to qualify for an exemption but they clearly state that our house build was a construction and not a "development" .
The real annoying thing about this is that we had to pay astronomical "development levies" for what is called our development on our Planning Permission. Our house build is clearly refererred as a development from the county council but it is considered a construction from Revenue.

Revenue also state that they have to abide by the legislation and " the subsection appears clear I.e it is aimed at individuals who purchased a site in 2012"

So basically only people who purchased a site are entitled to claim full Trs relief.

The last paragraph of the letter from Revenue quoted is " I appreciate the impact that this has on your cash flow situation but because the requirements to qualify for relief in respect of loans drawn down or partially drawn down and used in 2013 are statutory requirements set out in legislation, there is no administrative discretion on allowing relief in particular cases. I regret, therefore, that relief cannot be allowed in respect of the portion of the loan you drew down in 2013. You will of course continue to be eligible for Trs on the portion of the loan drawn down in 2012."

I do not know what the next step is. It is completely unfair but it looks like there is no way around Revenue due to the wording of the legislation.


Cheers,
Augusta

dos30

My TRS was cut in February, so I rang the helpline last week and was told it was cut as I only qualify for relief on draw downs in 2012.
The guy gave me the name and number of the person who had made the cuts and told me to ring them directly.
They were away on holidays so I got speaking to one of their colleagues.
He just asked me
Was your site purchased in 2012. Yes
Was your planning granted in 2012. Yes

I then emailed him a copy of the planning permission and he rang back saying full TRS has been reinstated.

ShiverinEskimo

Did you actually purchase the site dos30?

The snag for us and a few others here is the the site was a gift from a parent/family.

dos30

ShiverinEskimo wrote: »

Did you actually purchase the site dos30?

The snag for us and a few others here is the the site was a gift from a parent/family.

Yes from savings, no proof was required to show that it was purchased, or that it was purchased from the mortgage.

Augusta11

Hi Dos,

Thanks for replying. Unfortunately because we were gifted the site like some others who posted here, we are not entitled to claim TRS for any drawdowns in 2013.

I have argued numerous points with Revenue over the last 5 or 6 months about why I feel we should be entitled to claim the full TRS relief but we have been told every time we can not claim it as we did not buy the site with money from our mortgage.

Its interesting that you bought your site from Savings and didn't use your mortgage to buy the Site as outlined in the conditions by Revenue. Good for you, I'm glad that you have been able to get sorted. It has been an absolute nitemare trying to deal with Revenue so its refreshing to see that you were able to get your full relief which you are entitled to.

Thanks again for your update,

Cheers, Augusta

FFM01

Hi All,

Just wondering has anyone had any luck arguing their case with Revenue, they have been a nightmare to deal with. I site was gifted as in alot of your own situations. I have had replies from them, but they continue to change their argument on difference points, alot of which is incorrect and differs from what is clearly stated in legislation. I believe the legislation is not worded tightly enough to stop our TRS and can be argued.

FFM01

Hi All,

Just wondering has anyone had any luck arguing their case with Revenue, they have been a nightmare to deal with. Our site was gifted as in alot of your own situations. I have had replies from them, but they continue to change their argument on difference points, alot of which is incorrect and differs from what is clearly stated in legislation. I believe the legislation is not worded tightly enough to stop our TRS and can be argued.

Mr. Incognito

Just to let everyone here know

Here is a link to Revenue's customer charter

http://www.revenue.ie/en/about/custservice/customer-charter.html

It covers complaints.

I would advise everyone to ask for the reasons for the rejection in writing setting out the applicable legislation that applies as it your right

psmb

Hi,

I have recently had a response from a Revenue principal officer on this. There are a number of steps in the appeals process and having a review of your case by a principal officer is one of the steps. Unfortunately there doesn't seem to be much difference between the principal officer and the and the original reviewer. Again the principal officer says we are not entitled to the MIR on the portion of the mortgage drawn down in 2013 and he has somehow omitted the whole basis of my argument.

My argument revolves around the document [8.3.8] Relief for interest paid on certain home loans
Section 244, 244A and 245 TCA 1997
Last updated November 2012

Section 14 of this document refers to Residence under construction and purchase of sites,
Part C of section 14 states the following

(c) in the case of a first-time house purchaser, the residence may be accepted as the
individual’s sole or main residence with effect from the date of purchase of the site or, if
later, the date planning permission for the construction of the residence is granted BUT
if the individual does not wish to claim relief until the house is completed and occupied,
then the first time buyer relief can commence when the house is occupied;

Section C above states that once planning permission was granted the site became our sole or main residence. This mean the site became our qualifying residence when planning was granted in 2012. Any worked carried out after planning was granted was development or improvement of a residential premises which is our qualifying residence.

Taken these guidelines into account I believe that we qualify under section 8 of the taxes and consolidation act 1997 outlined below.

(8) This subsection shall apply to a loan in respect of which there was in place, on or after 1 January 2012 and on or before 31 December 2012, an agreement evidenced in writing to provide that loan to an individual and–– (this applies to us)

(a) part of that loan is used in the period 1 January 2012 to 31 December 2012, and (this applies to us)

(b) the balance of that loan is used in the period 1 January 2013 to 31 December 2013,

by that individual solely for the purpose of defraying money employed in the repair, development or improvement of a residential

premises which is a qualifying residence in relation to that individual. (this applies to us when the revenues guidelines on homes under construction is taken into account)

I am waiting for a response as to why this was not taken into account by the principal officer.

Also the principal officer said in their response that the definition of "development" provided by the county council and the dictionary definition forwarded by me have no relevance to section 244 of the taxes and consolidation act 1997.
I have asked asked for clarification on this as Section 244 of the taxes and consolidation act 1997 clearly refers to planning and states that planning permission has to be in place for an individual to be eligible. If the act refers to planning permission can you explain how wording in that planning permission documentation have no relevance?
Also could you explain how the dictionary definition of a word has no relevance to this act?

I am waiting for a response.

When looking at the revenue guidelines on homes under construction I do believe I and others on here are eligible for this relief. I intend to keep disputing this with revenue until my MIR is reinstated or until revenue can clearly point out to me how I am not eligible for this relief.

Mr. Incognito

I've had a cursory look at this.

As you say the section provides for relief on qualifying loans on qualifying premises.

It envisions relief for first time buyers on new builds.

If you are to build the house yourself then you would still qualify for the relief.

However the fact that you are gifted the site means that you did not use part of the qualifying loan to "buy" the premises or the footprint of the site.

You are arguing that building the house means to develop it. You are of course correct. However, it seems that the Revenue are rejecting it on the basis that you did not "purchase" the site.

I have also had a look at the 2013 Finance Act

http://www.irishstatutebook.ie/pdf/2013/en.act.2013.0008.pdf

At page 13 it says that the money must be used

(7) This subsection shall apply to a loan taken out and used
by an individual––
(a) on or after 1 January 2012 and on or before 31
December 2012 solely for the purpose of defraying
money employed in the purchase of an estate or
interest in the land referred to in paragraph (b) and
in respect of which the permission in subsection (10)
applies but only where a residential premises, which
is a qualifying residence in relation to that individual,
is constructed on that land, or

THIS WOULD APPEAR TO MEAN THAT THE MONEY MUST BE USED FOR THE SOLE PURPOSE OF PURCHASING THE HOUSE or

(b) on or after 1 January 2012 and on or before 31
December 2013 solely for the purpose of defraying
money employed in the construction of a residential
premises which is a qualifying residence in relation
to that individual on land––

SOLEY FOR CONSTRUCTION

I don't have time for a more in-depth analysis but I am unsure how Revenue are saying that it is a requirement under the 2013 FA that the money must be used to purchase some element of the site. You would appear to qualify if you either purchase or build.

FFM01

Hi All,

Just wondering has anyone any update or been successful in arguing this with Revenue?

Has anyone proceeded to appeal this with the Appeal Commissioners yet?

I believe we have a strong argument.

psmb

FFM01 wrote: »

Hi All,

Just wondering has anyone any update or been successful in arguing this with Revenue?

Has anyone proceeded to appeal this with the Appeal Commissioners yet?

I believe we have a strong argument.

I am in the process of going through the appeal process. I will let you know how it goes.
I have also lodged a complaint with the ombudsman.

barneystinson

psmb wrote: »

I am in the process of going through the appeal process. I will let you know how it goes.
I have also lodged a complaint with the ombudsman.

Why have you lodged a complaint with the ombudsman, out of interest?

FFM01

Hi,

Just wondering has anyone any update on this? Has your case been heard by the Appeal Commissioners yet psmb?

We are still restricted on our full TRS, they are not even giving us the 25% of our TRS which we are entitled to?

Any update would be great.

psmb

Hi FFM01

I still have not had a response from the appeal Commissioners. I am hoping to hear something soon and when I do I will post here.

Since I posted last I have been looking at the Taxes Consolidation Act 1997

Point 7 below states that you have to have acquired an estate or interest in a site, and the acquisition had to be financed by way of the loan referred to in paragraph A, it does not state that you have to have purchased the site.

I believe been gifted a site is acquiring and interest in the site. Am I wrong on this? Does anyone have a definition of "acquiring an interest in a site"

The Notes for Guidance – Taxes Consolidation Act 1997 – Finance (No.2) Act 2013 Edition - Part 8 states the following.
(9.—Section 244 of the Principal Act is amended by inserting the following after subsection (6):
“(7) This subsection shall apply to a loan taken out and used by an individual––
(a) on or after 1 January 2012 and on or before 31 December 2012 solely for the purpose of defraying money employed in the purchase of an estate or interest in the land referred to in paragraph (b) and in respect of which the permission in subsection (10) applies but only where a residential premises, which is a qualifying residence in relation to that individual, is constructed on that land, or

(b) on or after 1 January 2012 and on or before 31 December 2013 solely for the purpose of defraying money employed in the construction of a residential premises which is a qualifying residence in relation to that individual on land––
(i) in respect of which he or she has, on or after 1 January 2012 and on or before 31 December 2012, acquired an estate or interest, and
(ii) the acquisition of which was financed by way of the loan referred to in paragraph (a).

FFM01

Hi psmb,

Just wondering have you any update from the Appeal Commissioners yet?

Regards

Augusta11

Hi all,

Just a quick update on my situation.

I contacted a well known newspaper reporter to see if they could advise me on this situation. They contacted Revenue on my behalf. They forwarded on the email relpy from Revenue but basically it was very similar to the reply I've had from Revenue last year. Revenue have to follow the legislation so therefore we do not qualify for trs as we did not purchase our site with part of the loan.

The newspaper reporter has advised me to make a complaint to the appeals commisioners but i don't really know if there is any point trying to keep this up as Revenue aren't budging at all

psmb

Hi FFM01

I am still waiting to hear from the Appeal Commissioners. I will post once I do. Don't hold your breath.

psmb

For anyone interested, I am still waiting for my appeal to be heard.