If you are thinking about buying your first home in Ireland, you may have heard about the Help to Buy scheme. It is one of the more practical government supports available to first-time buyers, but a lot of people are unsure exactly how it works, whether they qualify, or how much they could actually get back.
Here is a straightforward breakdown.
What is the Help to Buy scheme?
The Help to Buy (HTB) scheme is a government tax refund designed to help first-time buyers in Ireland with the cost of their deposit. It allows you to claim back Income Tax and DIRT you have paid over the previous four tax years, up to a maximum of €30,000.
It is administered by Revenue, not the lender. The money comes from tax you have already paid, which means the amount you receive will depend on your individual tax history.
Who can use the Help to Buy scheme?
To qualify, you must:
- Be a first-time buyer
- Be purchasing or self-building a property that will be your main home
- Take out a mortgage of at least 70% of the purchase price, or the approved valuation in the case of a self-build
If you are buying jointly with someone else, both of you must be first-time buyers to qualify. If either person has previously owned a property, you will not be eligible.
How much can you get back?
The refund is the lowest of three figures:
- 10% of the purchase price of the property (or the approved valuation for a self-build)
- €30,000
- The total Income Tax and DIRT you paid over the four tax years before your application
For example, if you are buying a new home priced at €350,000, 10% of that is €35,000. The scheme caps the refund at €30,000, so that would be the maximum you could receive, assuming you have paid at least that amount in tax over four years.
The property must be priced at €500,000 or less to qualify.
What properties qualify?
The scheme applies to:
- New builds
- Self-builds
- In some cases, a non-residential property that has been converted into a residential home
Second-hand properties do not qualify. The home must be your principal private residence, meaning you need to live there yourself. You must also continue to live there for at least five years after purchase.
The Help to Buy scheme is currently in place until the end of 2029.
The difference between Help to Buy and the First Home Scheme
These two schemes are frequently confused, but they are quite different.
Help to Buy is a tax refund. You receive money back based on what you have already paid in Income Tax and DIRT.
The First Home Scheme is a shared equity arrangement. The government and participating lenders take a stake in your property in exchange for contributing to the purchase price, which you buy back over time.
Both are available to first-time buyers, and in some cases both can be used towards the same purchase. However, the rules, eligibility criteria, and long-term implications are different. It is worth understanding what each one involves before deciding what applies to your situation.
How do you apply?
Applications are made through the Revenue Online Service (ROS) or myAccount on the Revenue website. You will need to be registered with Revenue and have your tax affairs up to date.
The process involves:
- Checking your eligibility through Revenue
- Getting an application number from Revenue
- Providing that number to your solicitor and lender as part of the conveyancing process
The refund is paid directly to the property developer or, in the case of a self-build, into a specified bank account. If your tax affairs are not fully up to date, you will need to address that before applying.
A few things worth knowing before you apply
The amount you are entitled to can affect how much deposit you need to source elsewhere, so it is worth knowing exactly where you stand before you start house-hunting.
The scheme only applies to new properties. If you have your heart set on a second-hand home, it will not be available to you.
A mortgage broker can help you understand how Help to Buy fits into your wider mortgage plan, including how it interacts with your deposit requirements and borrowing limits.
At Halpin Wealth and Mortgages, we help first-time buyers across Cork and Ireland understand their mortgage options, including how government schemes like Help to Buy fit into the process. If you would like to understand what you might be entitled to and how it affects your plan, our team is here to help. Get in touch here.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Halpin Wealth Management t/a Halpin Wealth and Mortgages is regulated by the Central Bank of Ireland.