HRI for homeowners and landlords

Updated on April 4, 2022

Overview

Note

No claims will be accepted after the 31st of December, 2018.

For this deadline to be waived, it must have been granted before December 31, 2018. For work done between January 1 and March 31, 2019, tax credits will be available.

The HRI, which provides a tax relief for renovations, is available to homeowners, landlords, and local authority tenants. You can claim the HRI Tax Credit if you make repairs, renovations, or upgrades to your home or rental property.

Applicants to HRI must meet the following criteria:

If you are unable to use PAYE, you can instead use self-assessment.
To avoid fines, you must keep up with your Local Property Tax (LPT) payments (this does not apply if you are a local authority tenant)
Any work done on your property must be done by an HRI-qualified contractor.
The HRI is only available online for private property owners and landlords. It is possible to claim the HRI Tax Credit through myAccount if you pay taxes via PAYE. If you pay your own taxes, you can utilise ROS to claim the HRI tax credit.

In the event that a renter has any questions, they should contact Revenue.

How does HRI work?

Repairs, renovations, and improvements can be deducted from your taxable income thanks to the HRI tax credit of 13.5% of the entire cost. You must have paid for particular sorts of work on specific categories of property in order to be eligible for the credit. A licenced contractor is required to complete the project.

Based on the cost of the project, the amount of HRI Tax Credit you can claim is determined. Information on these expenses can be found in the section titled “Value of the HRI Tax Credit.

What type of work qualifies under HRI?

Tax relief is only available to those who have paid Value-Added Tax (VAT) at a rate of 13.5 percent on the work done to their eligible property. Here are some examples of qualified works:

decorating, painting, and laying tiles
renovations and additions to bathrooms and kitchens, as well as window replacement and attic conversions
insulation for garages, driveways, and landscaping of sewage tanks
Non-qualifying work
It is not possible to obtain tax reduction for all goods and services. Your contractor provides these items or services at a VAT rate of 23%. Among the non-eligible products and services are the following:

Architects’ costs, as well as the cost of carpets, furniture, and other appliances.
You cannot claim tax reduction if you purchase supplies yourself, such as paint or tiles.

What type of property qualifies under HRI?

Property owners undergoing renovations or repairs might benefit from the HRI programme. It’s fine to choose from the following:

You live in a rented property as your primary abode. Upon completion of the renovations, the property must be rented and registered with the Residential Tenancies Board no later than six months after the completion date.
Properties that don’t qualify
Newly constructed homes and vacation properties are not eligible for the HRI programme.

If so, are you listed as the property’s owner or co-owner by the IRS?
Owners of real estate are listed in Revenue’s Local Property Tax Register (LPT Register). As long as Revenue has had contact with you via LPT, you are on this list.

If you are not on the LPT registration, you can register as an owner or joint owner of your property by either:

chatting with an LPT representative via the LPT website’s live chat option.
LPT refunds are available if you haven’t paid your bill yet.

In order to claim the HRI Tax Credit, you and your partner will need to be co-owners of the property. A tax credit limit applies to the property. A portion of the overall tax credit is allocated to each owner based on the amount they spent.

When does the work have to be carried out?

If you are a homeowner, you may claim for qualifying work that was carried out and paid for from 25 October 2013. If you are a landlord, you may claim for work carried out and paid for from 15 October 2014. If you are a local authority tenant you may claim for work carried out and paid for from 1 January 2017.

You cannot claim for any work carried out or paid for after 31 December 2018.

The only exception to this closing date is if planning permission was in place by 31 December 2018. If so, work carried out between 1 January 2019 and 31 March 2019 will qualify for the relief.

Value of the HRI Tax Credit

It is required that you spend at least €4,405 on each eligible property in order to receive the Home Renovation Incentive Tax Credit. This is before the 13.5 percent Value Added Tax (VAT) is applied. A single job on the property may account for the entire cost, or it may include several. A qualified contractor can also perform this task. Within the allotted time frame of the incentive, any work that you claim must be completed and paid for.

The HRI Tax Credit can be claimed up to a maximum of €30,000. Prior to VAT of 13.5 percent, this sum is equal to this amount. Work on your home may cost you more than this. If this is the case, all funds in excess of €30,000 will be disregarded.

A single rental property can be divided into a number of rental properties. HRI is applied to each of these units in its own right. Each rental unit is limited to a maximum of €30,000 before VAT is imposed at 13.5 percent.

What is the HRI tax credit amount?
HRI credit amounts are determined by:

whatever award, insurance, or compensation claim you may be eligible for as a result of your qualifying works.
The minimum tax credit for a property is €595 in the absence of a grant, insurance, or compensation claim. The maximum tax credit is €4,050 (€30,000 multiplied by 13.5%).

Make a donation
Grants for qualifying work can reduce the overall qualifying cost by three times what the grant money is worth. For instance, the Sustainable Energy Authority of Ireland offers grants for attic insulation (SEAI).

Including VAT at 13.5 percent, Catherine paid €10,000 for external wall insulation.

The SEAI gave her a stipend of €2,700.

Expenditures that qualify for tax deductions are figured up as follows:
Amount of money Catherine had to spend on her training.

Taxes are included at a rate of 13.5%

€10,000

By a factor of three. The SEAI grant has been awarded to you.

€2,700 x 3 = €2,700

€8,100

Spending that counts towards eligibility

Taxes are included at a rate of 13.5%

€1,900

The sum of all eligible expenditures.

VAT-free amount

€1,900/100/113.5

€1,674

Tax credits Catherine will be eligible for

13.5 percent of €1,674

€226

Claims for protection and/or restitution
Any insurance or compensation payments you receive will reduce your total qualifying expenditure.

The following is an example.

Choosing a HRI contractor

If a contractor is HRI qualified, they are engaging in the HRI programme. In other words, the contractor is VAT-registered and tax-compliant.

Before doing any work, make sure that your contractor is a qualified HRI contractor. You will not be able to claim the HRI tax credit if your contractor is not a qualified HRI contractor.

How can you tell if a contractor has met the requirements?
Using HRI’s online verification system can tell you if your contractors are qualified. Contractors that have entered their work details can be confident that they are qualified.

Contractors that aren’t HRI qualified will be unable to enter HRI information online.

What you need to do prior to starting work
Make sure you do the following:

the contractor should be informed that you are applying for the HRI Tax Credit
ask the contractor if they are a qualified contractor for the programme and get their confirmation.
Request that the contractor use HRI to enter the information of the project.
Your Property ID (which may be found on your Local Property Tax (LPT) letters from Revenue) should be provided to your contractor.
Inform the contractor if the house is rented out.
What you should expect from your contractor
The details of the task must then be entered into HRI online by the contractor. Before the work begins, you must verify that the contractor has completed this. They must also input their payment information when you make them.. If the contractor does not accomplish this, you will not be able to receive the HRI tax credit.

Tenants of municipal authorities
Please contact your Revenue Office if you are a renter of a local authority before

How to claim the HRI Tax Credit

When can I claim Home Renovation Incentive (HRI)?

HRI can be claimed from January 1 of the year after the year in which the qualifying work was paid for. Payment for the qualifying work must to have been received within four years of filing a claim.

To become a member of HRI, how do I go about doing so?
The HRI online system is the only way to file a claim. The service can be accessed via:

Paying tax through PAYE? If so, go to myAccount and click on “Home Renovation Incentive” under “Property Services” on the “Property Services” revenue card Revenue Online Service (ROS).
Note

You will only be able to see the HRI tab if you are enrolled for Local Property Tax (LPT).

Prior to submitting a claim for HRI, you must not owe any LPT or Household Charge payments or returns.

The HRI Tax Credit will be paid to me in what form?
The two years after the year in which the work was paid for, you will receive your HRI Tax Credit. The credit will be split evenly between the two academic years .’s If you paid enough tax in each of the two years to be eligible for a refund, then you may be able to receive it back from the IRS.

Credits that aren’t used in the first two years will be carried over to future years. This applies to both PAYE and self-assessment taxpayers.

Local authority tenants should contact Revenue if they have any questions.