Taxes Consolidation Act 1997 section 245

Relief for certain bridging loans

Section 245 provides additional home loan interest relief where a person uses bridging finance when selling one main residence and buying another.

• Relief applies where a person sells their only or main residence and buys a replacement main residence, using a loan to fund the purchase, the sale, or both.
• Interest paid on the bridging loan (or on any replacement loan used to repay it) during the first 12 months qualifies for tax relief under section 244, as if the person had paid no other interest in that period.
• The relief is a standard rate tax credit, subject to the same annual limits as regular home loan interest relief — €6,000 for married and widowed individuals and €3,000 for single individuals.
• If the loan proceeds are used for any other purpose before being applied to the house purchase or sale, the relief does not apply.