Know Your Rights
A: Home Renovation Incentive
December 2017
Question
I am planning to extend my home. How can I claim the Home Renovation Incentive?
Answer
The Home Renovation Incentive (HRI) scheme enables homeowners or landlords to claim tax relief on repairs, renovations or improvement work that is carried out on their main home or rental property by tax-compliant contractors and that is subject to 13.5% VAT. It is also available to local authority tenants who have written consent from the local authority to carry out the works.
HRI is paid as a tax credit at 13.5% of qualifying expenditure, which can be set against your income tax over 2 years. You must be paying income tax to avail of HRI. You must also be up to date with your Local Property Tax (LPT) obligations.
Your contractor must be registered for Value Added Tax (VAT) in Ireland and be tax compliant. They also have to register the work on the HRI online administration system. If you use several contractors, such as a builder, a plumber and an electrician, you can combine the cost of the works to make up the minimum qualifying expenditure of €5,000 including VAT at 13.5%.
Repair, renovation or improvement work subject to VAT at 13.5% all qualify for the HRI, including extensions and attic conversions; supply and fitting of kitchens, bathrooms and built-in wardrobes; fitting of windows; plumbing, tiling, rewiring and plastering. Work subject to VAT at 23% is not covered. Neither are items such as furniture, white goods or carpets.
The work must be done and paid for by 31 December 2018. In general, the credit is paid over the 2 years following the year in which the work is done and paid for.
After work starts you should log in to HRI online to check that your contractor(s) have entered details of the work – if they have not, you will not be able to claim the credit. Once the work has been completed, you can claim the HRI credit. You access the HRI online system through Revenue’s myAccount service or through the Revenue Online Service (ROS) if you are registered for ROS.
There is detailed information about HRI on revenue.ie.
Further information is available from the Citizens Information Service below.
Know Your Rights
B: Christmas Bonus
December 2017
Question
I am getting a social welfare payment. Will I get a Christmas Bonus this year?
Answer
The Christmas Bonus is paid to people getting a long-term social welfare payment. Long-term social welfare payments include the following:
- State Pensions and Widow’s/Widower’s/Surviving Civil Partner’s Pensions
- Invalidity Pension, Blind Pension, Disability Allowance, Carer’s Allowance, Carer’s Benefit, Domiciliary Care Allowance and Guardian’s Payments
- Jobseeker’s Transitional payment, One-Parent Family Payment, Farm Assist, Deserted Wife’s Benefit and Allowance
- Community Employment, Rural Social Scheme, Tús, Gateway, Back to Work Enterprise Allowance and Job Initiative
- Back to Education Allowance (BTEA), VTOS and Further Education and Training (FET) training allowance (people coming from jobseeker’s payments must have been on their payment and/or BTEA or VTOS or FET training allowance for 15 months)
For Jobseeker’s Allowance (JA) or Basic Supplementary Welfare Allowance (BSWA), you must be getting the payment for 15 months to get a Christmas Bonus. However, if you were getting another payment eligible for the Christmas Bonus immediately before claiming JA or BSWA, and your combined time on the eligible payments is 15 months, you will get the Christmas Bonus.
In 2017, the Christmas Bonus will be 85% of your normal weekly payment (including the Living Alone Increase, the Island Allowance and the Over-80 Increase). Fuel Allowance is not included when calculating the Christmas Bonus. The minimum Christmas Bonus payment is €20.
For Domiciliary Care Allowance (DCA), which is paid monthly, the bonus is 85% of the weekly payment. The DCA portion of the bonus is calculated independently of other payments. So, for example, if you are getting full-rate DCA for one child, 85% of the weekly payment is €60.70.
Further information is available from the Citizens Information Service below.
Know Your Rights
C: Rent-a-room relief
December 2017
Question
I have retired from work and am planning to rent my spare room to a student lodger to supplement my pension. Will I have to pay tax on the rental income?
Answer
If you rent out part of your home as residential accommodation, the income you earn is exempt from tax, provided the total paid by the tenant(s) is not more than €14,000 in a tax year and you satisfy the qualifying conditions. This is called rent-a-room relief. It applies to accommodation in your home – which can include a self-contained unit such as a basement flat or a converted garage. It does not apply to rooms that are not attached to your home and it does not apply to rent paid by your child.
You must live in your home as your sole or main residence during the tax year for which you are claiming the relief and the room(s) must be used as residential accommodation. For example, you can claim the relief if you are renting a room to a student for the academic year, but not if you are taking in short-term guests.
If you rent a room in your home, residential tenancies legislation does not apply. So, if you are only renting out a room, you do not have to register as a landlord with the Residential Tenancies Board (RTB), provide a rent book to the tenant or ensure that the accommodation meets any minimum physical standards. However, if you rent out a self-contained unit such as a basement flat, the legislation does apply.
The gross income you get cannot be more than €14,000 in a tax year. This includes sums that the tenant pays to you for food, utilities, laundry or similar goods and services. Expenses that you incur are not deducted from gross income. If your income from rent and other services is over the limit, the entire income (not just the amount over the limit) is taxable.
If you qualify for rent-a-room relief, the income is not liable to Pay Related Social Insurance (PRSI), the Universal Social Charge or income tax. Claiming rent-a-room relief does not affect your mortgage interest relief or your exemption from Capital Gains Tax if you sell your home. If you are self-assessed for tax, you can enter the exempt income on the Revenue Online Service (ROS). If you are a Pay As You Earn (PAYE) taxpayer you can use the myAccount online service.
Further information is available from the Citizens Information Service below.
Know Your Rights
D: Buying goods online
December 2017
Question
I have ordered a few presents from a Belgian website. Can I return them if I change my mind when I get them?
Answer
Online purchases from businesses based in the EU are covered by the EU Directive on Consumer Rights. Under this Directive you are entitled to a cooling-off period of 14 days. During the cooling-off period, you can cancel distance contracts such as online purchases without giving a reason and without incurring charges or penalties, other than possible charges incurred in returning the goods. The 14-day cooling-off period begins on the day that you receive the goods.
Upon cancellation, the distance seller is obliged to repay you within 14 days, including delivery costs. If you chose a more expensive type of delivery than the seller’s cheapest standard delivery, you are only entitled to be refunded the cost of the cheaper delivery type.
The seller can withhold the repayment until the goods are returned or until you supply evidence that you have sent the goods back.
You must send the goods back within 14 days of informing the seller of the cancellation. You may have to pay for the cost of returning them. The seller must inform you of such costs before you complete the purchase.
The seller should also have provided you with confirmation of the contract, as well as information on aftersales and guarantees, how to cancel the contract and a postal address for complaints. If the seller did not provide you with information on your right to cancel, the cooling-off period can be extended by 12 months.
Some purchases are not covered by the cooling-off period. These include customised or perishable goods and bookings for transport or accommodation.
Further information is available from the Citizens Information Service below.
Know Your Rights has been compiled by Co Wicklow Citizens Information Service which provides a free and confidential service to the public. See www.citizensinformation.ie for details of your local centre or phone our main office in Bray on 0761 07 6780
Information is also available online at citizensinformation.ie and from the Citizens Information Phone Service, 0761 07 4000.
