Renovated House Internal Images Photo - 1

We plan to extend our home and hope to claim the Home Renovation Incentive. How does this scheme work?

Answer (March 2016)

The Home Renovation Incentive (HRI) scheme enables homeowners to claim tax relief on repairs, renovations or improvement work carried out on their homes. Landlords can also avail of the scheme. It is paid in the form of a tax credit at 13.5% of qualifying expenditure, which can be set against your income tax over 2 years. You must be paying income tax to avail of the HRI. You must also be up to date with your Local Property Tax (LPT) obligations.

Your contractor must be registered for Value Added Tax (VAT) in Ireland and be tax compliant. They also have to register the work on the HRI online administration system. If you use several contractors, such as a builder, a plumber and an electrician, you can combine the cost of the works to make up the minimum qualifying expenditure of €5,000 excluding VAT at 13.5%.

Repair, renovation or improvement work subject to VAT at 13.5% all qualify for the HRI, including extensions and attic conversions; supply and fitting of kitchens, bathrooms and built-in wardrobes; fitting of windows; plumbing, tiling, rewiring and plastering. Work subject to VAT at 23% is not covered. Neither are items such as furniture, white goods or carpets.

The work must be carried out and paid for by 31 December 2016. In general, the tax credit is paid over the 2 years following the year in which the work is carried out and paid for. If you are a PAYE taxpayer, the credit will be included in your annual Tax Credit Certificates. If you are a self-assessment taxpayer, it will be incorporated into your tax assessment.

After work starts you should log in to HRI online to check that your contractor(s) have entered details of the work. You will not be able to claim the HRI tax credit if the details have not been entered onto  HRI online. Once the work has been completed you can claim the HRI credit. You access the HRI online system through Revenue’s myAccount service or through the Revenue Online Service (ROS) if you are registered for ROS.

There is detailed information for homeowners and landlords on