My husband and I are in the process of purchasing an old derelict house which we plan to demolish and build a new house on the site. We are both first-time buyers and will be borrowing 70 per cent-plus loan-to-value mortgage. Will we qualify for the Help-to-Buy scheme?
Mrs P.H., email
No matter how detailed the guidelines provided on incentives such as the Help-to-Buy scheme, there are inevitably situations that fall outside the guidance available – and the position you present seems to do precisely that.
In general, to qualify you need to be a first-time buyer and to borrow more than 70 per cent of the value of the property. Clearly you qualify under both these restrictions.
However, the other key restriction is that you must either buy a property that is newly built or undertake a self-build project.
In your case, you are buying a previously occupied property, which would, at first sight, exclude you from the scheme. However, you have no intention of occupying the property and are essentially purchasing it only for the site.
Of course, what you plan to do and what is permitted under the rules are not necessarily at one.
However, Revenue has not dismissed out of hand the possibility that you would still qualify for the tax rebate of up to €20,000 available under the scheme.
When I contacted Revenue, it reminded me that the legislation was very specific, which it is, especially in relation to the issue of a “qualifying residence”, as we have said above.
The wording of the Revenue response is important. “A ‘qualifying residence’ must be a new building which was not, at any time, used, or suitable for use as a dwelling,” it says.
“At any time” sounds like a key phrase in the context of your query.
In its response, Revenue also says that whether or not you qualify for the Help-to-Buy scheme would depend “entirely on the level of dereliction” of the property you are buying.
Whether you are retaining any part of the existing dwelling in your own self-build project would also be a factor in any decision on eligibility for the scheme.
Not surprisingly, in the circumstances, the best Revenue can advise is that first-time buyers considering a project along the lines you outline really should contact the Revenue, which will consider such applications on a case-by-case basis.
Contact can be made either through the MyAccount online service that you need to use for the application process anyway, or by using Revenue’s LoCall numbers. These vary, depending on where in the State you’re based. In Dublin, it is 1890-333425. For the East and South East Region, which includes Carlow, Kildare, Kilkenny, Laois, Meath, Tipperary, Waterford, Wexford and Wicklow, the number is 1890-444425. The South West Region, which covers the remaining counties in Munster, is 1890-222425. Finally, the Border, Midlands and West Region which, apart from the Ulster and Connacht counties, includes those parts of Leinster outside of Dublin and the counties in the East and South East Region, is 1890-777425.
Send your queries to Dominic Coyle, Q&A, The Irish Times, 24-28 Tara Street, Dublin 2, or by email to dcoyle@irishtimes.com. This column is a reader service and is not intended to replace professional advice.
