Publication
Operational Guidelines: SWA - Mortgage Interest Supplement
From Department of Social Protection
Published on
Last updated on
From Department of Social Protection
Published on
Last updated on
The purpose of Mortgage Interest Supplement is to provide short term income support to eligible people who are unable to meet their mortgage interest repayments in respect of a house which is their sole place of residence. The supplement assists with the interest portion of the mortgage repayments only. The capital element of the repayment is not taken into account in calculating the amount of supplement payable as it is not considered appropriate that the Exchequer should repay part of the initial loan and thereby provide assistance towards the accumulation of a capital asset on the part of the individual concerned.
Applications for Mortgage Interest Supplement can be made to your local Department of Employment Affairs and Social Protection Office administering Supplementary Welfare Allowance.
A person may be entitled to a supplement towards the amount of mortgage interest payable in respect of his or her residence provided that:
The department’s representative must be satisfied in all cases that:
In exceptional circumstances, the department’s representative may award a supplement where the amount of mortgage interest payable by a person exceeds such amount as the department’s representative considers reasonable to meet his or her residential and other needs. Such supplement is payable for a maximum of 12 months from the date of the claim.
Certain categories of people are excluded from receipt of Mortgage Interest Supplement.
These include:
Rent Supplement is normally calculated to ensure that a person, after the payment of his or her mortgage interest, has an income equal to the rate of SWA appropriate to their family circumstances less a minimum contribution which recipients are required to pay from their own resources. The weekly minimum contribution is €30 for single adult households and €40 for coupled households. Many recipients pay more than this amount because recipients are also required, subject to income disregards, to contribute any additional assessable means that they have over and above the appropriate basic SWA rate towards their accommodation costs.
A further minimum contribution is also payable in respect of each non-dependent adult household member. It is custom and practice to reduce the Mortgage Interest Supplement payable by at least €30 in respect of each non-dependent household member who is in receipt of a Social Welfare payment or income from employment.
The following items are not counted in the means test for Mortgage Interest:
The following are the principal income disregards which apply in the calculation of means for Mortgage Interest Supplement purposes:
Pensioner disregard
A special income disregard exists for those aged 65 years or over. Any additional income equal to the difference between the maximum rate of State (Contributory) Pension and the Supplementary Welfare Allowance appropriate to his or her circumstances can be disregarded.
In effect, any single person aged 65 or over with income equivalent to the value of the maximum rate of State (Contributory) Pension should only make the minimum contribution of €30 per week. A pensioner couple who both have a State (Contributory) Pension payable at the maximum rate - and have no other income - should contribute €40 per week towards their mortgage interest payment.
Carer's Allowance disregard
The rules governing the means test for Mortgage Interest Supplement provide for a disregard of income derived from Carer's Allowance:
Half Rate Carer's Allowance Disregard
From 27th September 2007, all income received in respect of half rate Carer's Allowance made under Section 24 of the SW and Pensions Act 2007 is disregarded in full.
Additional Income Disregard
The 'additional income disregard' refers to the amount of additional income from certain sources, over and above the appropriate SWA rate, that can be disregarded.
The 'additional income disregard' was introduced with effect from 6 June 2007 as follows:
The "additional income" is the amount of income in excess of the SWA rate, applicable to household circumstances and includes income derived from:
The amount of maintenance over €95.23 per week that can be disregarded is €75 per week with 25% of any maintenance in excess of €170.23 (€95.23 + €75) also disregarded.
For persons participating in approved training courses, any lunch or travel allowances that are paid may also be disregarded. Certain training courses now provide a childcare allowance to participants on certain courses. These childcare allowances are treated in the same manner as a lunch or travel allowance and disregarded.
Rehabilitative Employment
Up to €120 of earnings from rehabilitative employment can be disregarded. However, this disregard cannot be applied together with 'the additional income disregard'. Only one such disregard can be applied, whichever is most beneficial.
Capital (savings and investments) and the value of property owned but not personally used or enjoyed is assessed as means. Where capital or property is assessed on this basis, any income received from its use (for example interest on savings, dividends from shares, rent from property let) is not assessed as cash income.
Instead, the following formula is used to establish weekly means:
Special arrangements are in place to allow a person to participate in approved employment or training schemes or engage in full time employment and retain his or her entitlement to Mortgage Interest Supplement.
The primary conditions for retaining Mortgage Interest Supplement are that:
These arrangements are specific to Mortgage Interest Supplement and are no longer applicable to Rent Supplement.
Participation in Approved Employment Schemes
Subject to certain conditions, people participating in the approved employment schemes listed below may retain a portion of their Mortgage Interest Supplement:
*VLTU Back to Work scheme
The Programme is targeted at those who are at least five years on the Live Register. During an initial 6 weeks training, participants receive a travel or meal allowance of €44.50 per week. This allowance and any payments employers may give them during this period are disregarded.
From the seventh week, where participants opt for the Back to Work scheme, Mortgage Interest Supplements may be retained on the same basis as any other recipient of BTWA.
Participants may also receive two separate €253.95 once off payments which are disregarded in the assessment of entitlement to a Mortgage Interest Supplement payment.
*Option of standard SWA rules assessment
People participating in Back to Work and Community Employment schemes, or those on other approved employment schemes, who work less than 30 hours per week, have the option of being assessed under either standard rules or under the retention rules outlined above and will be entitled to receive payment under the more favourable option in their situation.
Where a person moves from one employment scheme to another, for example from Community Employment to Back to Work, the four year cycle for tapered retention of Mortgage Interest Supplement dates from the commencement of the first scheme.
In cases where 12 months or more have elapsed since the completion of the previous scheme, claimants should be regarded as first time applicants starting a new cycle.
Where a person, who has been unemployed for 12 months or more, secures open market employment they may retain Mortgage Interest Supplement on the same tapered basis that applies to those participating in employment schemes, (75% in year 1, 50% in year 2, 25% in years 3 and 4), provided that:
This option only refers to retention of Mortgage Interest Supplement and does not extend to people who were not already in receipt of the supplement immediately prior to taking up employment.
The option of a Standard SWA rules assessment does not apply in these cases.
In general, asylum seekers are not allowed to work while their claim for asylum is being processed, however, asylum seekers who arrived in the State on or before 26 July 1999 and who were awaiting a final determination on their claim for asylum for 12 months or more were granted permission to seek employment. Entitlement to Mortgage Interest Supplement is assessed as at 5.1 to 5.3 above in cases where an asylum seeker in this category secures employment.
A person who is not entitled to retain Mortgage Interest Supplement on taking up employment may continue to receive payment of the relevant supplement for a period of up to 30 days after starting work or until such time as he or she first receives remuneration, whichever is the earlier.
The arrangements which allow for the tapered retention of Mortgage Interest Supplement for employment scheme participants do not apply in the case of those participating in the Back to Education Programme.
Participants in the Back to Education Programme are assessed for Mortgage Interest Supplement under standard SWA rules.
BTEA is payable to people participating in approved second or third level courses.
While the BTEA itself is not means-tested however additional earnings from part time employment are assessable in the normal way for Mortgage Interest Supplement, that is up to €75 per week with 25% of any additional income, with no upper limit, also disregarded.
Part time basic education or training and development courses are not covered by the Back to Education Allowance scheme. Participants should check with their local Social Welfare office to see whether their participation in these courses affects their primary payment.
Any additional earnings from approved training and development courses are assessable in the normal way for Mortgage Interest Supplement, that is up to €75 per week with 25% of any additional income, with no upper limit, also disregarded.
Participants on the Department of Education and Science VTOS programme are assessed for Mortgage Interest Supplement under the standard assessment, that is up to €75 per week with 25% of any additional income, with no upper limit, also disregarded.
See this section in "Supplementary Welfare Allowance" guideline.