Student Accommodation Scheme

The Department of Education and Science has recently published a document on the student accommodation scheme that seeks to provide clarification on a range of issues that have arisen since that Department’s guidelines on the scheme were published. It is available at www.education.ie. Some of the issues are of a minor technical nature while others are more substantive. The main changes are -

• The definition of a “student” has been amended to include certain foreign exchange students.
• A development can be certified by one or more educational institutions.
• There is a general requirement that a qualifying lease must be drawn up for the whole of the academic year regardless of whether the lease is drawn up between a certifying educational institution and another party or between any other parties. There are a limited number of situations where the qualifying lease can be for a shorter period than the full academic year. These are -
  • the year in which a development is first completed where it is not completed until after the start of the academic year
  • where the duration of the course is shorter than a full academic year in the case of certain foreign exchange students attending courses in Ireland
  • where a lease is unexpectedly terminated during an academic year. In such a situation, a new lease can be drawn up with another student of the certifying educational institution covering the remainder of that academic year.
• A lease that is drawn up between an owner of a student accommodation unit and a management company that will let the bed spaces to students of the certifying educational institution is regarded as a qualifying lease if certain conditions are met.
• The treatment of a caretaker unit is clarified. The original guidelines treated a caretaker unit as part of the “communal facilities and amenities”. The intention was that such facilities and amenities would be provided for communal use and would also be owned communally. Under the Tax Acts the general position in relation to relief for investment in residential accommodation is that relief is only available where an investor owns a “house”. Therefore, to qualify for relief for expenditure incurred on a share of the communal facilities and amenities, an investor must also have purchased a house. Relief is not available for expenditure incurred solely on communal facilities and amenities. However, expenditure incurred on a caretaker unit can qualify for relief, in its own right, as actual student accommodation if that caretaker unit meets the requirements of the guidelines, for example, occupation by at least three students of a certifying educational institution and the appropriate certification by the Department of the Environment, Heritage and Local Government. Essentially, the caretaker would have to be a student of the certifying educational institution.

Queries on the following issues should be addressed to the Department of Education and Science, Third Level Building Unit, Government Buildings, Tullamore, Co. Offaly.

• Certifying educational institutions
• Consultation process
• Certification procedure
• Meaning of student
• Qualifying areas
• Qualifying developments
• Communal facilities and amenities

Queries on the following issues should be addressed to the Department of the Environment, Heritage and Local Government, Housing Grants Section, Government Buildings, Ballina, Co. Mayo.

• Floor areas of premises
• Internal design and layout
• Site planning
• Certificate of reasonable cost
• Certificate of compliance

Queries on any other issue should be addressed to the relevant local Revenue office; see the Contact Locator (where the customer’s tax reference number is known) or the Contact Details page on the Revenue website www.revenue.ie. Contact details are also available in the Tax Briefing supplement published in July 2005. Revenue has published guidance material on section 23-type relief that covers, inter alia, the student accommodation scheme. This document should deal with most queries that are likely to arise. It is available at www.revenue.ie under ‘publications/technical guidelines’.