Thousands of first-time home buyers fail to claim tax refunds

Government initiative dismissed as "nothing more than a gimmick"

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Fewer than 350 people have benefited from a tax relief scheme for first-time buyers, new figures show.

The government initiative allows people purchasing their first home to claim a refund of deposit interest retention tax (DIRT) on savings. The relief applies to tax paid on mortgage deposit savings up to 20% of the house purchase price.

The scheme, which expires at the end of next year, was intended to reduce the impact of tighter mortgage rules imposed by the Central Bank.

But only 335 people have been refunded since the initiative began in October 2014, according to figures obtained by Fianna Fáil finance spokesperson Michael McGrath.

In the past 19 months, Revenue has paid out a total of €326,888 - an average of €975 per person.

Separate statistics from the Banking Payments Federation of Ireland indicate that just under 20,500 mortgages were drawn down by first-time buyers in the same period.

On that basis, less than 2% of potentially eligible purchasers have so far availed of the refund scheme.

Deputy McGrath said high interest rates, Central Bank rules and a lack of housing supply have combined to make home ownership increasingly unaffordable for young people.

"The announcement of the scheme was nothing more than a gimmick to distract attention from the escalating housing crisis,” he said.

Fianna Fáil has called on the government to introduce a “help-to-buy” initiative that would instead top up first-time buyers' special deposit savings accounts by 25%.