Stamp duty was the issue on most people's minds during an online question and answer session on ireland.comyesterday. The new regime accounted for almost three-quarters of all the queries submitted.
• Below is a sample of the questions asked.
PROPERTY TAXES
When do the new stamp duty exceptions come into effect?Fiona Evans
The new stamp duty rates take effect from December 5th, 2007, although it should be noted that where a residential property deed was executed in the 30 days prior to this date, the new rates will apply to the stamping of that document.
Do the reduced rates of stamp duty apply to transfers of land and housing sites?Andrew Keating
Based on the Minister's announcement on Wednesday, the answer seems to be no. The stamp duty changes only apply to residential property (ie, a home).
How will the changes to the clawback change from five to two years work?Luke Byrne
The change in claw back will take effect for deeds of transfer executed on or after December 5th this year, ie for purchases which take place after December 5th. It also applies to situations where the property is rented out for the first time after December 5th, 2007 and a person is in their third, fourth or fifth year of ownership.
Is the new mortgage interest relief backdated?James Donnelly
The increase in mortgage interest relief for first-time buyers is being increased from relief on €8,000 to €10,000 for single people (and from €16,000 to €20,000 for married couples) with effect from January 1st, 2008. The increase also takes effect for people currently in the first seven years of their mortgage, that is, it does not just apply to new mortgages.
Do you agree with the Minister's assertion that the stamp duty changes are "counter cyclical"?Ciara Barry
The Tánaiste has estimated that the cost to the Government of introducing the new stamp duty regime will be €190 million in 2008. This is equivalent to the Government putting €190 million into a housing market that is particularly weak at present and can thus be seen as a counter-cyclical intervention.
The Tánaiste himself said in the Budget that the reforms "will lead to a simplification of the system which will increase the efficiency of the housing market, boost confidence and support employment and overall economic activity."
MOTOR TAXES
Can I register a new car in the UK, pay duty there and then import it as a secondhand car here and not pay the new VRT rates?Paul Murphy
The key issue here is the date of purchase. The new VRT rates apply to the purchase of new cars on or after July 1st, 2008. Therefore, if you purchase and register a car in the UK after that date, the new VRT rates will apply. If you purchase a car prior to that date, the old rules should apply.
Does linking BIK to mileage not encourage people to drive extra miles to lower their tax?This seems to run counter to the "green measures" on VRT. Oisin
Well spotted! The Government would argue that the more mileage a person does (and bear in mind it should be business mileage), then the better for the economy it is. The UK has a CO2 basis for calculating car benefit in kind.
PERSONAL TAX
I earn €38,000 a year and pay €850 a month rent. How am I better off after the Budget?Norma
A single PAYE worker will see their after-tax income increase by €434, with the €70 increase in the personal and PAYE tax credits and changes to the standard rate band as well as PRSI and the health levy. You will also benefit from a €40 increase in the rent tax credit, which is now worth €400 a year.
Has there been a change to domicilary care allowances?Sharon Alexander
Carer's Allowance has increased from €200.70 per week to €214.70 per week with effect from January 1st 2008.
I am a full-time carer with two children with special needs. How much can my husband now earn before I lose my carer's allowance?Maura Donnelly
The weekly income that can be disregarded when means testing the Carer's Allowance is €665 (for a couple). This income rate takes effect from April 2008.
PENSIONS
What is the pensionable age for qualified adult? My wife is a qualified adult aged 64.Jerome Tierney
There are two main rates for the qualified adult, the payment given to the spouse of a contributory State pension holder. One is for people aged 65 and under and one is for people aged 66 and over. Your wife will be entitled to the €200 rate when she is 66. As a result of the Budget, the qualified adult rate for your wife will be €148.80.
• The questions were answered by Paul Tansey, Economics Editor and Laura Slattery from The Irish Times and Niamh Cleary and Seán Walsh, Tax Managers with PricewaterhouseCoopers. The full Q&A is at www.ireland.com/ focus/budget 2008/
