Let's look at this as an investment.
I don't know what the tax position is for you as a UK resident.
You are paying €12,000 a year in repayments, but this is comprised of €3,600 interest and €8,400 capital.
So you are reducing the mortgage very quickly due to your cheap tracker.
So your best way of saving is probably to keep your investment in Ireland. You are "saving" €8,400 a year.
It is also a fairly tax efficient investment. Any increase in value up to the price you paid for it, will be free of Capital Gains Tax.
No lender is doing deals for the early repayment of trackers, and it's unlikely that they will do deals. But it's possible and it's another minor reason to hold on to it.
Your plans may change and you may decide to return to Ireland at some time in the future. Most lenders in Ireland allow borrowers to port their trackers to a new family home. So, yet another reason to hold onto it.
So should you use your savings to pay down this mortgage? Probably not. The interest rate of 1.68% is probably lower due to tax relief. If you were Irish resident, the net interest rate after tax would be 1%. ( 1.68% - 50% of 75% of 1.68%)
Can you get a tax-free return higher than 1% in the UK? I think you probably can.
Other reasons for not paying down your mortgage
- You may be able to get a mortgage in the UK without selling your Irish property, so the more cash you have the better
- If you do return to Ireland, you will not want to have paid down a cheap tracker
- If the lender does do a deal on the tracker, the higher your LTV the better.
So save your money elsewhere.