The Revenue Commissioners has told banks to delay a plan to stop paying tax relief to people in mortgage arrears until all institutions were in a position to implement it.

Banks are due to stop paying the tax relief if a home owner has not paid the interest on a loan for six months or more.

One bank had already sent letters to home owners in arrears informing them that the tax relief would be stopped.

However, Revenue has confirmed that it has contacted banks asking them to delay taking the step until all lenders are ready to proceed.

A spokesperson for Revenue said: "In the interest of equity and uniformity, a decision was taken to postpone the move to the 'paid basis' until all financial institutions were in a position to do so."