First Home Buyers benefit from Budget change

In the handing down of the 2011 budget, if you're a first time home buyer this would be a relief to you.Generally speaking, when an employer subsidises an employee’s housing, the employee is required to pay tax on the benefit. The rate of tax payable depends on the value of the house. However, under current tax law, if your employer provides the subsidy under an approved low cost housing scheme and the value of the house is under a certain amount, you are exempt from paying tax on the benefit. You are also exempt if the amount advanced by your employer for a first home is repayable and the advances are debited against certain employee benefits, including superannuation (as is the case with the Housing Advance). From 1 January this year the Citizen Employee First Home Buyer Scheme replaces the former Low Cost Housing Scheme and the upper value of the property has been increased to K400,000, Significantly higher than the previous K75,000