Home-owners repaying mortgages can now seek Income Tax relief from the interest charges, a move that Finance Minister Dr. Ashni Singh on Tuesday said would cost the treasury GUY$580 million annually.
“This relief is expected to make home ownership even more affordable and attractive, will increase disposable incomes in thousands of households, and will constitute a significant injection of cash into the economy for both saving and consumption, thereby generating and multiplying further business activity,” Singh was quoted as saying by the Government Information Agency (GINA).
Singh’s remarks were made after he signed the Income Tax (Mortgage Interest Relief) Regulations 2013, several months after this year’s National Budget was passed by the House.
The Regulations now have to be published in the Official Gazette.
The Finance Minister explained that first-time home owners who have borrowed up to GUY$30 million from commercial banks or the New Building Society (NBS) would be permitted to deduct the interest they pay on such mortgages from their taxable income for the purpose of personal income tax.
“In other words, that portion of taxable income used by a first time home owner to pay interest on a housing loan of up to $30 million from a commercial bank or building society will be exempt from personal income tax,” GINA reported.
Singh has since signed advised the Guyana Revenue Authority (GRA) and the participating financial institutions that they could implement the regulations as soon as possible.