Finance Bill - Personal Taxes

PRSI on Non-Employment Income

PRSI of 4% will be payable on non-employment income of employees and certain pensioners from 1 January 2013.

Mortgage Interest Relief
The Bill provides for a new rate of mortgage interest relief of 30% in respect of qualifying interest paid by first time buyers who purchased their principal private residence between the years 2004 to 2008.  Mortgage interest relief will be available at 25% for first time buyers who purchase in 2012, reducing to 22.5% in years 3-5 and 20% in years 6 & 7. In the case of non-first time buyers who purchase in 2012 relief will be available at 15%.  The limits on relievable interest for qualifying first time buyers will be €10,000 for a single person and €20,000 for a married person. For non first time buyers it will be €3,000 for a single person and €6,000 for married persons.

DIRT
The rate of DIRT has been increased to 30% with effect from 1 January 2012.
Deposit Interest earned from EU financial institutions will also qualify for DIRT at 30% (subject to timely filing of income tax returns). Deposit Interest earned from non-EU financial institutions will also be taxed at 30% where the taxpayer is a standard rate taxpayer and makes a timely tax return. Higher rate taxpayers will continue to be taxed at 41%.

  Contact Mark Butler or Maura Duffy for further information.

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