Rent tax credit was valuable support, Finance Minister says

The Finance Minister has emphasised the “importance” of the renters’ tax credit as he works on finalising the Budget.

The scheme has allowed tenants to claim thousands of euro in their rent payments back as a tax credit.

For 2024 and 2025, the amount to claim back was 20% of yearly rent payments, up to a maximum credit of 1,000 euro for an individual or 2,000 euro for a jointly assessed couple.

For 2022 and 2023, the credit was 500 euro for an individual and 1,000 euro for a couple.

Two weeks out from the Budget, Mr Donohoe said the measure had played an important role in supporting tenants with rising rents.

Speaking at the ceremonial opening of the latest phase of the Royal Canal active travel scheme, he said no decisions have yet been made on any tax measure, but added: “I’ll just emphasise my recognition of the importance of that credit.”

More broadly, however, Mr Donohoe said the budgetary approach will be a shift from “larger one-off measures” to “more targeted” schemes.

Asked about the comments on Friday, Sinn Fein housing spokesman Eoin O Broin said the existing tax credit was a “half-hearted” version of his party’s proposal for a fully refundable tax credit for private renters which would “put a full month’s rent back in their pocket year after year”.

He said the Government’s tax credit “isn’t enough”, adding that about half of eligible renters are not claiming it because the “Government isn’t promoting it”.

Mr O Broin said the party remains fully committed to its alternative renters’ tax credit.

Social Democrats housing spokesman Rory Hearne said the key issue in the Budget will be whether there is a significant increase in the funding for social and affordable housing, as he warned the tax breaks for developers would be “the completely wrong thing to do”.

On the renters’ tax credit in particular, Mr Hearne said his party was not against it continuing, but added: “What the government should be doing is actually controlling rents.

“With rising, it’s similar with the Housing Assistance Payment, you’re stuck in this cycle of ever rising rents, and the new measures that the Government are introducing will not properly control rents, because new market rents will still be uncontrolled and landlords will have the ability at different points to reset to market rent.”