Mortgage Interest Relief For Landlords
From the 7th of April 2009 the tax relief for landlords on mortgage interest paid on debt used to purchase, improve or repair a residential property has been restricted to 75% of the interest incurred in the year. With effect from 1 January 2017 the amount restricted increases to 80%. The restriction will increase by 5% every subsequent year until the full 100% of interest incurred is allowable. Landlords will therefore be entitled to a full interest deduction with effect from 1 January 2021. For landlords renting properties to tenants availing of Housing Assistance Payment (HAP) scheme, 100% of the mortgage interest can be claimed on condition that an undertaking is given that the property be rented to HAP tenants for at least 3 years. Mortgage interest is claimed, subject to the above restrictions, in the first 3 years of the tenancy. The balance up to 100% of the relief can be claimed by the landlord in the year following the expiration of the three-year tenancy. Landlords should note that the availability of the interest deduction is still dependent on the tenancies being registered with the Residential Tenancies Board.