RENT RELIEF
Thousands of Irish set for major €1k or €2k payment hike on cash paid straight into accounts in Budget shake-up
Thousands can already claim for this year - here's how
THOUSANDS of Irish could cash in if a major payment is boosted from €750 to €1,000 in Budget 2025.
New Finance Minister Jack Chambers and Minister for Housing Darragh O'Brien have backed a fresh increase to the Rent Tax Credit - the second in two years.
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The credit - which can be claimed annually by around 400,000 renters - was increased in Budget 2024 to €750 for a single person and €1,500 for jointly assessed couples.
The cash scheme previously saw single renters get €500 back once they'd paid €2,500 rent in the specific calendar year, or jointly-assessed couples getting back €1,000 once they'd shelled out €5,000 in rent.
And thousands of renters could be owed the credit for previous years, with figures showing how countless payments have been left unclaimed, despite the payment being processed within around five days of claims being made.
But Ministers have hinted that the payment could be hiked again - possibly to €1,000 for a single renter and €2,000 for couples.
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O'Brien said: "That's something that we will absolutely discuss and Minister Chambers and I have already said that we would like to see a further expansion of the renters' tax credit.
"Really importantly for renters, lots of renters want to buy.
"That's why we've scaled up the First Home scheme. We've invested an additional €80million this year, €40million from us, €40million from the banks, because lots of renters are now buying their homes by using the First Home scheme."
Minister Chambers said: "I think on the renters' tax credit, it was a really important measure to help support renters where rents were rising and are rising and gives them some support from the state.
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"Obviously every budget I think has to make progress when it comes to affordability and housing and supporting renters.
"We're not at the point yet of deciding what rental policy measures might be.
Minister for Finance Michael McGrath announces €750 Rent Tax Credit increase in Budget 2024
"But we want to make sure that each budget we make successive and continued progress for renters and also on affordability of housing."
Former Finance Minister Michael McGrath previously confirmed PAYE taxpayers can claim the increased €750 rent tax credit in-year to ease the financial burden of renting, as soon as they've paid €2,500 in rent for 2024.
Social Democrats TD Gary Gannon questioned Minister McGrath on when the payment could be made to renters for this year.
In response, the McGrath said: "PAYE taxpayers can also claim in-year relief using Revenue’s Real Time Credit facility on myAccount.
"This allows taxpayers to receive the benefit of the credit through their payroll over the course of the current year.
"Following such a claim, an amended Tax Credit Certificate will issue confirming the amount of relief and a revised Revenue Payroll Notification containing the total of the claimant’s tax credits will be made available to their employer.
"This process typically takes no more than three to five working days."
But newly minted Minister for Finance Jack Chambers warned that this year's Budget will be "tighter" than previous years.
Chambers said he is keen to get back to a more "regular" budgetary environment than what was previously rolled out during the Covid-19 pandemic and high levels of inflation.
He said he wants to strengthen living standards and support for householders and families who are still under pressure from the rise in inflation in recent years.
HOW TO CLAIM RENT TAX CREDIT
- Log into revenue.ie.
- In the first box, under PAYE Services, click Review your Tax.
- Once you have filled out your basic details and checked your income tax details are correct, you can apply.
- To apply for the tax credit, go to the You and Your Family section, and scroll down to rent tax credit.
- You'll be asked to fill out your basic details and if you receive any housing support.
- Your PPS number is required and Revenue also asks for the RTB number of the registered property.
- Renters are asked to fill in the landlord’s home address and state if they are resident in Ireland but this section is not essential.
- Claimants are also asked to declare if they're related to the landlord and whether the property is your main residence.
- The Rent Tax Credit Form is next, which allows users to put in their total rent and calculate what they’re entitled to. The maximum which can be applied for is €2,500 meaning someone paying rent for an entire year would likely have paid well over €2,500 and so be entitled to the full 20 per cent or €500 tax credit. This will amend to €750 then for the year 2024, but €500 will be the maximum claim for tax years 2022 and 2023.
He said: "On wider cost-of-living challenges, the current economic backdrop is that inflation has levelled at around 2 per cent and we expect modified domestic demand to strengthen, which means the wage increases that households are experiencing should see real effect in economic terms through the year.
"The Budget is really framed in a careful way. We'll obviously set that out next week as part of the summer economic statement."
He added: "But we're clear that for many there are still pressures on households and on families and we want to make sure we strengthen living standards and support people through the winter period.
"What that mix might be is something we're going to have to be careful about.
"It's going to be a tighter budget than what we've had through Covid and through very high levels of inflation.
"I think we have to get back to a more regular budgetary environment, but through that and through sound economic management we still have the capacity to support people and improve living standards.
"That's what we'll be seeking to do in a progressive way in the budgetary process."
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Separately, Minister O'Brien said he will publish revised housing targets in October, hinting that they could reach up to 50,000 per year.
He added: "Jack and his department did a really good piece of work recently, that if we were, for example, to go to 50,000 (houses), that you're looking at the requisite investment for that on or around €20billion.
"To put that in context, this year we will deliver mid to high 30s, hopefully, we're investing €5.1billion as a state.
"There will be about €8billion to €9billion in addition to that by private finance to deliver that scale of homes.
"We're looking at a significant ramping up."
He continued: "I intend to publish, with the approval of Government and colleagues such as Minister Chambers, will publish the new targets in October of this year.
BUDGET 2025 HINTS - WHAT WE CAN EXPECT
By ADAM HIGGINS, Political Correspondent
Taoiseach Simon Harris back in May said Ireland is not yet out of the woods when it comes to the cost-of-living crisis as he signalled there will be more one-off Budget bonuses.
He said: "In the coming Budget, we must ensure we provide the extra funding required to keep pace with the expanding population and a cost-of-living and welfare package that protects the most vulnerable.
"Income tax bands and credits must again be properly indexed so that people do not drift into the higher rate band of income tax."
In recent years, the Government has handed out extra social welfare payments for people availing of supports.
And Harris said the Government knows that "a strong economy has to translate into tangible benefits for our people."
He added: "Right now, I know people are still hurting.
"Cost of living increases have left them feeling their personal finances are insecure and might not withstand any further shocks. We need to give them a sense of security that the Government get this."
Former Finance Minister Michael McGrath previously told how workers will cash in on major tax breaks as part of the Coalition’s last Budget.
Speaking at the Fianna Fail Ard Dheis in Dublin back in April, the Cork TD boasted about how this Government has reduced income taxes and cut the USC rate for the first time in five years.
He said his next Budget will target carers, pensioners, families and people with disabilities — a signal he plans to increase social welfare payments.
He also revealed Budget 2025 will include a major income tax package that will see workers keep more of their hard-earned cash.
He said: "In this autumn’s Budget, we will again have a substantial income tax package. This is vital for individuals and families, but it is also important for our economy that Ireland has a competitive personal tax system."
"They are going to be ambitious. Every target we've set so far we've exceeded, so targets have never been the ceiling, they've been the floor."
WELFARE CALLS
And Child Benefit payments should be increased by €50 per month and a new €20 weekly Cost of Disability payment must be implemented, it's been warned.
And it's been claimed ALL weekly social welfare payments must go up by €25 weekly in Budget 2025 to support hard-pressed households.
Social Justice Ireland has called for several increases including a €50 hike in monthly Child Benefit payments to aid with cost of living burdens as part of Budget 2025
Launching Budget Choices 2025, their budget package proposal, they said their must be a new focus on "closing income gaps and building resilient public services" in the next Budget.