Home Renovation Incentive (HRI)

A new Revenue scheme has been introduced which enables homeowners to claim tax relief on repairs, renovations or improvement work that is carried out on their homes by tax-compliant contractors and is subject to 13.5% VAT.

The HRI will be paid in the form of a tax credit at 13.5% of qualifying expenditure, which can be set against your income tax over 2 years.

To qualify for HRI:

• 1. You must be an owner-occupier and the work must be carried out on your principal private residence.
• 2. You must be up to date with your obligations under the Local Property Tax AND Household Charge.
• 3. You must be paying income tax – whether under PAYE or self-assessment.
• 4. Any contractor used must be registered for VAT in Ireland and be tax-compliant.
• 5. If several contractors (eg builder, electrician, etc) carry out qualifying work on your home, you can combine the cost of the works to make up the minimum qualifying amount.
• 6. The work must be repair, renovation or improvement work that is subject to VAT at 13.5%. This would include extensions, attic conversions, garages, the supply and fitting of kitchens and bathrooms, fitting of windows; plumbing, tiling, rewiring and plastering. Repairs or replacement of a septic tank are also covered. Work on driveways and on rainwater harvesting systems can also qualify. Work that is subject to VAT at 23% (such as architect’s or Solicitors fees) is not covered. Neither are items such as furniture, white goods or carpets. If you are unsure about whether your works will qualify, contact Revenue.
• 7. In general, work must be carried out and paid for between the 25 October 2013 and 31 December 2015. However, if planning permission is required and is in place by 31 December 2015, work paid for up to 31 March 2016 will qualify. Qualifying work between 25 October 2013 and 31 December 2013 will be treated as if it was carried out and paid for in 2014. You should check with Revenue to ensure you come within the rules before starting.

In general, the tax credit will be payable over the 2 years following the year in which the work is carried out and paid for. I
The qualifying work must cost at least €4,405 before VAT at 13.5%, which adds to a total of €5,000 with VAT included. You will only get the tax credit in relation to a maximum of €30,000 (before VAT) during the 2 years covered by the HRI.

The minimum credit is €595, based on the minimum qualifying expenditure of €4,405. The maximum is €4,050, based on the maximum qualifying expenditure of €30,000.
If you are claiming a grant for the works, or if they are covered by an insurance claim, the amount of your expenditure that qualifies for HRI will be reduced.

You should contact Revenue before engaging in any work to be sure that you come within the scheme.

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