I read your article about tax relief on student accommodation and got my tax relief. Thanks. So I go to book my daughter’s student accommodation in Dublin again for 2024-25 and find it’s gone up from €10,000 to €14,000.
The students must rebook for 51 weeks, unlike this year when all students could finish up on June 8th. My daughter and her other flatmates won’t be in Dublin
I now shop in Vincent de Paul’s for my own clothes as all my tax refund money is gone! It’s not worth working in Ireland.
Ms A.C.
The good news is that you got some money back in the tax credit to which you were entitled for last year and, depending on when your daughter moved up to Dublin, the year before.
But that’s about it.
Rent tax credit was designed to give some relief to people paying rents at record levels.
It was introduced in the 2023 budget, announced in October 2022, and backdated so that people could claim for that year. Although it was initially focused on renters getting credit against tax that they had paid themselves, the Government quickly amended the rules so that parents funding accommodation for their children in third level could claim for that cost.
It has since been further extended to include students living in digs or under the rent-a-room scheme, with eligibility again backdated to the start of 2022.
You are allowed to claim back 20 per cent of the rent paid, up to a maximum payment for €500 for 2022 and 2023. So you will have needed to be paying €2,500 in rent in each of those years to get the full available credit.
In the last budget, the credit was increased to €750 from this year, 2024, as long as you pay rent of at least €3,750 this year.
To claim the credit, you need to make a tax return, as you have done – something that is increasingly becoming normal even for PAYE workers as they look to claim reliefs for medical expenses, rent, etc.
But back to you. You are facing a whopping 40 per cent rise in the cost of securing accommodation for your daughter. That’s a figure that leaves you dramatically worse off despite the tax credit, which runs counter to the whole intention.
I’ve no doubt that the provider will point to the fact that the cost covers an extra 10 weeks of accommodation, meaning your daughter is signing up for almost an extra 25 per cent in terms of the time the accommodation is available to her.
But, as you rightly point out, that is no use to students who move out of home only to attend college and generally return home after the academic years ends ... to save money if nothing else. Many students will also travel at that time. And even if they are working, there is nothing to say their student accommodation will be suitably located for them.
The whole point of dedicated student accommodation is that it provides security on housing for students during the college year – and only for that time. And from what you say, that has been the case here up to now.
Crunching the figures on the basis that the the landlord in this would presumably argue, the extra 10 weeks would have added €2,400 to the cost you are paying this year. To get to the €14,000 figure, the landlord is then raising prices (including for the period that is useless to your daughter) by a further 13 per cent.
That’s over twice the rate of inflation in private sector rents in the 12 months to December 2023, according to the Central Statistics Office.
It is difficult to see this as anything other than the accommodation provider gouging and making sure they are not left with units during the summer “down period” that are not generating rent.
Student accommodation providers are well aware of the shortage of accommodation in that market. That makes parents nervous at turning down renewals for fear that other providers – who do offer accommodation on the 41-week basis required – will not have space once they assess renewals among their own existing student tenants.
The provider your daughter is with has also, until now, offered short-stay summer accommodation during the lull in the college year. They have yet to clarify on their website whether that accommodation will be offered in the summer of 2025 but I imagine they will do so.
What’s not clear is whether they will refund students who do not use their accommodation for those last 10 weeks where the landlord finds another tenant. As I understand it, the system is normally that it is up to the tenant to find a replacement suitable to the provider if they are to secure a refund. Or will they simply take payment twice over for the same accommodation?
Either way, this reeks of sharp practice. You should look at alternative sites in Dublin and see if you can get something suitable with a landlord who understands the realities of student accommodation needs.
Please send your queries to Dominic Coyle, Q&A, The Irish Times, 24-28 Tara Street Dublin 2, or by email to dominic.coyle@irishtimes.com. This column is a reader service and is not intended to replace professional advice
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