Tax of renting house

work

Hi,
I am looking at renting out my house and moveing (somewhere very cheap, possibly with parents). Are the interest payments tax deductible if you rent out a house? Is there a resource listing all expenses for landlords?
Thanks

ricman

http://www.irishlandlord.com/ i think you can claim some tax credits on interest,
see www.revenue.ie search landlord.
you,ll need new house insurance policy or get public liabilty insurance added on to existing policy .
you can claim tax credits against,insurance,repairs,purchase of washing machine,carpets etc
my friend is a landlord ,pays no tax,her mortgage is ten k, rental income is 8k,
ie she makes no profit.
she has to pay some tax to the local council.
if you live there first ten k rent is not taxable.
if you go over ten k, its all taxable.
its very important to register with revenue as a landlord,even if it turns out,you are making only 50 euro profit, after paying loan,insurance,repairs etc otherwise they,ll audit you .i think mortgage interest relief is now set at seven years max.
if you buy a roll of wallpaper,a can of paint you can get tax credits for that,
holdon to all reciepts,you.ll
have to fill in a self assessment form as a landlord.even if you make zero profit.

Johnny Bitte

How would renting your house out affect TRS?

Dixie Chick

Goose- your TRS should be cancelled if you rent out your house and claim 75% of interest paid as a deduction from rental income. You must register with the PRTB to have your interest allowable as an expense though.

Johnny Bitte

Crap on the TRS part.
"claim 75% of interest paid as a deduction from rental income"
Sorry could you explain this a bit more?

Dixie Chick

Yep sure. Say for example your mortgage is 10k in the year and the mortgage interest part of this is 8k. And you got rental income of 7k,

You basically would be able to use 75% of the mortgage interest as a fully deductible expense in the year against any rents you receive so.

Rental income 7000
less Interest 6000 (75% of 8000)
= Rent profit 1000 (on which you will be taxed)

Johnny Bitte

Just popped over to irishlandlord there and saw a mock budget.

Ha ha I though I wold pay tax every month ha ha silly me.

Cool thanks Dixie and sorry for hi jacking the thread.

Scary business this landlord stuff.

ricman

SEE www.revenue.ie trs search ,theres a ceiling on how much trs you can claim per year, eg 20 per cent of interest up to 3k max, check the revenue website for info, and theres a seven year limit.i,m going by memory, not sure of the exact amount.you can still claim tax credits for insurance,repairs,expenses, eg you will NEED public liability insurance, in case someone has an accident in your rental property.thats at least 500 per annum.
see here http://www.revenue.ie/en/tax/it/leaflets/cg13.html trs info

DarrenDay

If you have bought any time in the last 6 years you will more than likely making a loss every month.

mathepac

ricman wrote: »

... theres a ceiling on how much trs you can claim per year, ...

TRS only applies to a PPR; once it's rented it's no longer OP's PPR therefore TRS is finito.

troops

ricman wrote: »

eg you will NEED public liability insurance, in case someone has an accident in your rental property.thats at least 500 per annum.

mine was only 350 compared to 300 when I lived there myself so not much difference

paul71

You should also be aware of the Capital gains tax implication of renting. If you sell a house that is your principle private residence you are exempt from gains tax, if however you rent the property for a proportion of the period you owned it you will be liable for Capital Gains pro ratia for that period.

Sheep Shagger

paul71 wrote: »

You should also be aware of the Capital gains tax implication of renting. If you sell a house that is your principle private residence you are exempt from gains tax, if however you rent the property for a proportion of the period you owned it you will be liable for Capital Gains pro ratia for that period.

If you purchased in the last say 3 years will anyone actually make a capital gain ?

Cookie_Monster

The bank may also have issues with your mortgage if the property becomes an investment property rather than PPR. You'd need to check the terms of the mortgage.

3DataModem

Sheep Shagger wrote: »

If you purchased in the last say 3 years will anyone actually make a capital gain ?

What counts is the gain made while rented, not the overall gain.

Also you get a CGT free year when you rent out your PPR.

Sheep Shagger

To put it another way, will anyone make a capital gain whilst renting a property in the newt few years (if they bought in the last few years?)

delllat

Sheep Shagger wrote: »

To put it another way, will anyone make a capital gain whilst renting a property in the newt few years (if they bought in the last few years?)

probably not ,depending on how good a deal they got and the year/location of purchase

majority will be in negative equity for awhile id guess