Over 180,000 owners failed to claim up to €1,250 fee relief that was designed to soften the shock of lifting mortgage interest rates. As a group, they could lose up to 120 million euros.

In October 2023 the then finance minister Michael McGrath introduced a temporary, one-off mortgage interest reduction credit which was targeted at homeowners who have been hit by six interest rate rises since European Central Bank (ECB) in 2023, which left many paying more than €4,000 a year more in loan repayments by the end of 2023 compared to 2022.

At the time, the minister suggested that up to 208,000 people would benefit, with tracker mortgage holders, those with standard variable rates and people whose loans were taken over by so-called beneficiary vulture funds.

Tracker holders – of whom there are around 180,000 have been the cohort that has seen the cost of their home loans rise the fastest, with the rates they pay always moving in tandem with the rates offered by the ECB.

Although the budget move was widely welcomed when it was announced more than a year ago, people have been slow to take advantage of it. By the end of last month, only 26,859 people had claimed tax refunds from Income.

This means about 12 percent of those who Finance Department expected would qualify. In June, the number of borrowers applying for relief was just under 23,000, suggesting that the rate at which claims are filed has fallen sharply since the summer.

According to figures from Revenue, those who applied for the loan received discounts of just over €18 million in total, which amounts to €670 per borrower. If the remaining 181,000 people considered eligible filed claims at the same level, the amount they would receive back would exceed €120 million.

Figures may change in light of returns from self-assessed taxpayers. Information on claims made by self-assessed taxpayers is not yet available. Those taxpayers were due to file their 2023 returns by the end of last month — or by Nov. 14 for online filers.

A recent survey conducted by Taxback.com found that 700 out of 1,400 respondents had never heard of the mortgage tax credit, suggesting that a lack of knowledge could be at least partly responsible for low take-up of the credit.

There has also been criticism from some quarters that making a claim is too complex, with claimants having to lodge a tax return with the Revenue, a process most PAYE workers are unfamiliar with.

The credit is available to taxpayers in respect of their family home where the outstanding mortgage balance was between €80,000 and €500,000 on 31 December 2022. It is paid at a rate of 20% of the owner’s interest increase in 2023 over 2022, up to a maximum 1,250 EUR.

While it was initially billed as a one-off measure of the cost of living, it has since been expanded to include this year – again measuring this year’s mortgage interest against the 2022 figure – in last month’s budget.

Taxback.com says the mortgage deduction isn’t the only tax credit people are leaving behind. While about 400,000 renters are eligible for tax credit for rentfewer than 100,000 claimed it last year.

For the 88 percent of homeowners who qualify for the tax credit but haven’t applied yet — and renters who still have to claim the credit — there’s still time to file for 2023, with the limit on claiming refunds of taxes. for both PAYE and self-assessed individuals set at four years.

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