Revenue Operational Manual 0.0.

[08.04.10] Repayment of appropriate tax to first-time

purchasers
266A TCA 1997

Created April 2015

1. Introduction

The Finance Act 2014 inserted a new section, Section 266A into the Taxes
Consolidation Act (TCA) 1997. This section provides for the repayment of
Deposit Interest Retention Tax (DIRT) on certain savings held by a qualifying
first–time purchaser.
First-time purchasers of a house or apartment will be eligible to make a claim to
the Revenue Commissioners for a refund of the DIRT paid on the interest earned
on their savings.
The relief applies to first-time purchasers where the property is purchased or self-
built.
Under Section 266A 2(b), DIRT will only be refunded where the DIRT would not
otherwise fall to be repaid under any other provision of the Tax Acts, for example
by virtue of age or disability.
Section 266A has effect on and from 14 October to 31 December 2017 inclusive.

2. Qualifying conditions

2.1 Eligible first-time purchaser

The first-time purchaser at the time of a relevant purchase or completion must not
have either individually or jointly with any other person, previously purchased or
built a house or apartment.

A first-time purchaser buying jointly with another person cannot avail of the
DIRT refund unless the other person is also a first-time purchaser.

2.2 Date of Purchase

The repayment of DIRT will only be made to eligible first-time purchasers on the
conclusion of the conveyance or transfer of the property into the name of the first-
Revenue Operational Manual 0.0.0

time purchaser during the period from 14 October 2014 to 31 December 2017
inclusive.

2.3 Date of Completion

For a newly built house to qualify under this section its construction must be
completed between 14 October 2014 and 31 December 2017 inclusive, to a
standard where it is suitable for immediate occupation as the first-time purchasers’
place of residence.

2.4 Place of residence

The house or apartment purchased or self built must be for use as the first-time
purchasers’ place of residence. Properties acquired for investment purposes are
not eligible for DIRT refunds.

2.5 Relevant savings

Where the property is purchased, relief is confined to DIRT deducted from

interest received on savings, up to a maximum of 20% of the purchase price of the
house or apartment, held at any time in the 48 months prior to the purchase date.

When the property is self-built, relief is confined to DIRT deducted from interest
received on deposit, up to a maximum of 20% of the completion value of the
house, held at any time in the 48 months prior to the completion date. While the
completion value will be self-assessed, it may be subject to audit in the normal
course by the Revenue Commissioners.

Savings include the aggregate amount of any relevant deposits held in the name of
a first-time purchaser, individually or jointly with another first-time purchaser.
Savings could be held in multiple Bank, Building Society or Credit Union
accounts. The first-time purchaser will need to obtain evidence of the DIRT
deducted from their financial institution.
Revenue Operational Manual 0.0.0

3. Claiming the relief

3.1 How to make a claim

To make a claim, the property must be registered for Local Property Tax (LPT).
Once registered, the taxpayer can log in to the LPT system and enter their
PPSN/Tax Reference Number, Property ID and Secure LPT PIN.

Once in the LPT system, clicking on the Claim DIRT F.T.B. Refund button will
display a claim form enabling the taxpayer to enter the required information and
submit their claim.

3.2 Required information

The following information is needed to make a claim:

 Amount of DIRT to be refunded

 Purchase price or completion value for self-build
 Purchase date/Completion date
 Email address
 Bank Account details to which the refund is to be paid (if bank account
details are already on file they will be displayed and can be amended if
necessary)
 Evidence of DIRT deducted (i.e. bank statements/interest certificates)

4. Duration of the scheme

Section 266A has effect on and from 14 October 2014 and will be in place up to
and including 31 December 2017.

In relation to a house purchase the conclusion of the conveyance or transfer of the

property into the name of the first-time purchaser must be completed during this
time period.
Revenue Operational Manual 0.0.0

In relation to a self built house its construction must be completed between 14

October 2014 and 31 December 2017. It must also be built on property conveyed
or transferred into the name of the first-time purchasers on or before 31 December
2017. This allows for the building of a house on land which was already owned by
the first-time purchaser.

5. Examples

Figures used in the below examples are for illustrative purposes only.
The amount of DIRT suffered will be supplied by the first-time purchasers’
financial institution and will depend on the timings of the savings made, interest
rates, prevailing DIRT rate etc.

Example 1

Mary, a first-time buyer, buys a house on 31 October 2014 for €200,000.

Relief is confined to DIRT paid on savings up to a maximum of 20% of the

purchase price which is €40,000 (€200,000 @ 20%).

In the 48 months prior to the purchase date (i.e. 1 November 2010 to 31

October 2014) Mary:

 Saved €30,000,

 Earned interest of €455 prior to DIRT being deducted,

 Paid €155 DIRT on the interest,

 Relief due of €155.

Therefore as the savings are under the maximum of 20% of the purchase price
Mary is entitled a full refund of DIRT, in this case €155.

Example 2

Joint first-time buyers John and Louise complete the construction of their
newly built home on 31 January 2015 and it is suitable for immediate
occupation.

The house is valued at €300,000. Relief is confined to DIRT paid on savings

up to a maximum of 20% of the completion value of the house which is
€60,000 (€300,000 @ 20%).
Revenue Operational Manual 0.0.0

In the 48 months prior to the purchase date (i.e. 1 February 2011 to 31 January
2015) John and Louise held the following on deposit;

John:

 Saved €30,000
 Earned interest of €420 prior to DIRT being deducted
 Paid €143 DIRT on the interest

Louise:

 Saved €35,000
 Earned interest of €490 prior to DIRT being deducted
 Paid €167 DIRT on the interest

In this case the savings are over the maximum of 20 % of the completion
value. The joint first-time buyers are not entitled to a refund of all DIRT paid,
but only on the DIRT on the maximum savings allowable.

The following formula can be used to determine the relief for each first-time
buyer:

Max Relief x DIRT Paid on interest

Savings

John: €60,000 x €143 = €132.00. Louise: €60,000 x €167 = €154.15.

€65,000 €65,000

6. Compliance

Control systems are in place to ensure that the total of the relevant amount of
DIRT is refunded only once for each house purchase or house completion.

The first-time purchasers will declare that the amount of the DIRT refund sought
is correct and statements of the amounts of DIRT deducted from their interest will
be obtained from their financial institutions and supplied with their claim.
Revenue Operational Manual 0.0.0

The following material is either exempt from or not required to be published under the
Freedom of Information Act 2014.

[…]

7. Revenue contacts

Enquiries can be submitted online on www.revenue.ie through the LPT ‘Your

Enquiries’ mechanism which is available on the taxpayer’s individual LPT details
page.