Mortgage interest relief calculation

[showmedmoney]

hello

if you had a 250,000 loan over 35yrs and were a first time buyer,(within the last 7 yrs)

fixed nterest rate at 4.5%


how much is the new TRS post budget worth to me

thanks

 

[ClubMan]

You can use Karl Jeacle's mortgage calculator to work out how much interest you would be paying and then see how much relief you would be entitled to up to the maximum individual FTB limit of €8K @ 20%. Basically for an individual FTB you get 20% relief on the lower of €8K or the amount of interest that you actually pay in a year.

 

[amofeeney]

but hasn't this doubled to 16k as of yesterdays budget?

 

[ClubMan]

No - it doubled from €4K to €8K for an individual.

 

[showmedmoney]

i think i will be paying about 9k interest for the year


Max = 8k/year

8000 X 0.2 =1600

so it works out about 130 per month

sound about right?

 

[ClubMan]

Yes. €133.33 per month if you are paying €8K or more in interest and are a FTB sole owner.

 

[eiregal]

So if there are joint FTB owners, should the relief be c. €260 p.m.?

 

[Dreamerb]

So if there are joint FTB owners, should the relief be c. €260 p.m.?

If and only if your interest payments equal or exceed €16k per annum - otherwise, as ClubMan points out above, the mortgage interest relief is available at 20% of actual interest paid.

 

[eiregal]

By my reckoning, using the Karl Jeacle calculator, we'll be paying €11,140.41 in interest this year so that should mean c. €185 in interest relief per month?

 

[Dreamerb]

Looks right. Unless you're on a fixed rate the interest may vary, of course, but as a general budgetting figure it's a good guideline.