Mortgage interest tax relief for those on variable and tracker mortgages was amongst the measures announced by the Government’s in Tuesday's Budget.
Minister for Finance Michael McGrath announced the introduction of the one-year relief for homeowners who have borne the brunt of the European Central Bank’s series of interest rate hikes in the last year.
Those eligible to apply will have had an outstanding mortgage balance on their primary dwelling of between €80,000 and €500,000 at the end of last year.
Relief will be available on the increased interest paid on the mortgage in the calendar year 2023 as compared with the amount paid in 2022, at the standard rate of 20% income tax.
The relief will be capped at €1,250 per property.
"Approximately 165,000 mortgage holders will benefit from this measure with an estimated cost of €125 million," Minister McGrath said.
The Help-to-Buy scheme is also being extended to the end of 2025.
Minister McGrath also said he is amending the scheme so that applicants of the local authority affordable purchase scheme can avail of Help-to-Buy. He said this change will take affect from tomorrow and will run until the revised end of the scheme in 2025.
Households will also receive a further set of credits to assist with energy bills over the winter with three credits of €150 each set to be provided between the end of this year and April 2024.
Minister for Public Expenditure Paschal Donohoe also said a €300 lump sum payment will be made to recipients of the Fuel Allowance in the last quarter of the year, while an additional €200 will also be paid this year to recipients of the Living Alone Allowance.
Minister McGrath also said he would extend the 9% reduced VAT rate for gas and electricity for another year.
"It is estimated that consumers will save an additional €90 for electricity and those who use gas will save an additional €62 during the 12-month extension," he said.
The Minister also announced an increase in the Rent Tax Credit from €500 per year to €750 per year for 2024 while a temporary rental tax relief is being introduced that Minister McGrath said will primarily benefit small landlords.
He said: "Subject to certain conditions being met, rental income of €3,000 for the year 2024, €4,000 for 2025 and €5,000 for the years 2026 and 2027, will be disregarded at the standard rate."
Parents who pay for their student children who have tenancies in 'Rent a Room' or 'digs' accommodation will also be able to claim the Rent Tax Credit.
It will also be backdated to allow for claims to be made for the 2022 and 2023 tax years.
Minister Donohoe said housing delivery is "performing strongly" and said the Government expects to exceed its target of delivering 29,000 new homes by the end of this year.
He said that next year, the progress will be accelerated with just under €7 billion of funding to the Department of Housing, Local Government and Heritage, of which €2.6 billion will be capital investment in housing.
He said that among the measures is €1.9bn in capital funding in 2024 to deliver 9,300 new build social homes and €265m to support the delivery of 6,400 affordable homes in 2024.
