Everything we know about the potential increase in rent tax credit for Budget 2025

In a bid to attract younger voters, the government is considering a significant increase in the Rent Tax Credit in Budget 2025

The Rent Tax Credit, which benefits around 400,000 renters annually, saw its last increase in Budget 2024, when it was raised to €750 for single renters and €1,500 for couples. 

Finance Minister Jack Chambers is reportedly in favour of the proposed hike while minister O'Brien says the increase aims to alleviate financial pressure on renters. 

O'Brien said: "I have been clear about my desire to see this credit raised further. We recognise the challenges faced by renters, and this increase would provide crucial assistance."

He acknowledged that while many renters want to own homes, the government is committed to supporting those who are currently renting. 

"Our goal is to ease the financial burden of renting while we continue to support homeownership through various schemes," he added.

A significant number of eligible renters have yet to claim the credit

To address this, O'Brien announced plans for an awareness campaign, particularly targeting parents who may not know they can claim the credit for their children's college rent. 

He explained: "Many parents are unaware that they can apply for this credit even if they are paying rent on behalf of their college-aged children."

O'Brien also contrasted the government's approach with that of the main opposition party, criticising them for a proposed renters' tax credit plan that left a €400 million gap.

"Unlike the opposition, we have budgeted to ensure all eligible renters can benefit from the credit, and we are focused on increasing awareness," he said.

Finance Minister Chambers highlighted the importance of the Rent Tax Credit, noting that it provides essential support as rents continue to rise. 

He said: "Each budget should advance our efforts to improve affordability and support renters, though we have not yet finalized the rental policy measures."

In response to the proposed increase, Sinn Féin has voiced concerns. Eoin O'Brien argued that without a ban on rent increases, the increased credit would be offset by rising rents. 

"The proposed increase in the Rent Tax Credit will offer little relief if not accompanied by a halt to rent hikes," he said. 

O'Brien called for a new approach that includes a ban on rent increases, a fully refundable tax credit, and accelerated development of social and affordable housing.

READ MORE: