The Guyana Revenue Authority (GRA) has commenced approving Mortgage Interest Relief (MIR) to taxpayers who meet the criteria set out in Section 20A of the Income Tax Act Chapter 81:01 and supporting regulations, the revenue collection agency said in a statement on Tuesday.
The implementation of MIR is in keeping with a proposal announced in the 2013 National Budget designed to encourage home ownership.
A deduction is given in respect of the amount of interest paid on a mortgage or loan taken out by an individual for:
1. the purchase of land to construct a residential building or
2. the construction of a residential building or
3. The acquisition of a residential building
The deduction is limited to thirty percent (30%) of the interest paid on the principal sum of a loan limited to a maximum not exceeding G$30M and takes effect from the Year of Assessment 2014.
While the MIR may be granted to a person who is a sole or joint owner of the property and the sole or joint borrower of the lending institution, for joint owners and borrowers each person must be separately eligible for the relief.
Taxpayers who are eligible can apply on or before the December 31, 2013 for MIR. Applicants must used the prescribed application form (Form 1) which can be downloaded from the GRA website www.gra.gov.gy or uplift same from our office at 200-201 Camp Street. Completed application forms must be lodged at the MIR window on the ground floor. All applications must be accompanied by the originals and copies of:
1. Transport/Title Certificate of Property
2. Sale and Purchase Agreement (if applicable)
3. Agreement with lending institution
4. Letter by lender ( Form 2)
Persons are urged to ensure that the lending institution is an approved lending institution by simply enquiring. Lending institution means an approved mortgage finance company (approved under section 15 of the Act) or licensed financial institution (licenced under the Financial Institutions Act 1995.