How to Calculate Mortgage Interest Relief
Mortgage interest relief is a tax relief available in Ireland. Since 2002, it has been given at the source, which means lenders either credit an individual's mortgage account each month or mortgage payments are reduced. The relief is subsidized by the government, and in order to qualify for mortgage interest relief the loan must be used to buy or fix up a primary home in Ireland. For first time buyers, the relief can be taken for up to seven years.
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Instructions
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Determine what year of the mortgage you are in. If you are in the first two years of your mortgage and are a first-time home buyer, you can claim 25 percent of your interest. For years three through five, you can claim 22.5 percent of your interest. For years six and seven, you can claim 20 percent of your interest. If you are not a first-time home buyer, your interest relief is 15 percent across the board.
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2
Determine the total amount of interest you paid during the year. If you are single, use this amount or 10,000 euros, whichever is less. If you are married, use 20,000 euros or this amount, whichever is less.
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Multiply your interest payments or limit by the percentage of relief you can claim. For example, if you were single and paid 6,000 euros in interest the second year you owned your home, multiply 6,000 by 0.25 to get 1,500 euros as your annual relief.
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Divide your annual relief by 12 to find your monthly relief. This is the amount of money you should see credited to your account each month.
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