'Rent a room scheme' Landlords and the €100 property charge / Budget

Sky King

I have three tenants in rooms in my house.

I am trying to decide whether to pass on the €100 annual household charge (=€25 PPS including myself) or just take the hit myself.

I am curious as to what others in my position are doing.

I also would like to know if the ceiling of €10,000 of tax free rental income on the rent a room scheme is to be reduced. I havent seen anything on it, though I have looked.

Interested in opinions. Thanks.

pippam

I heard that the 100 quid annual property charge will keep increasing every year and it will go up to 800 quid. Might be a clever move to start charging the tenants for it now and ease them in. But I'd be curious to see what other landlords will do as I'm not one.

ronan45

I cant see Tenants in a private house too happy about paying this really.
Does the property charge apply to Buy to Let accomodation also or just private principal Residence.

Custardpi

It'll be interesting to see what effect, if any this has on average rents going forward. I'd say generally whether the charge gets passed on to tenants will vary from area to area. If your property is in an area where the supply of rentals (assuming quality is roughly equal) outstrips demand then you'll have to take the hit & vice-versa. Once you have a rough idea of what the market is like in your area you can get a rough idea of the price-elasticity of the demand.

Sky King

A landlord already pays a charge on his or her second property, including buy to let and holiday home. This was introduced last year.

Pippam, I agree that it will probably increase every year, though I would imagine that it will be costed based on the market value of your house.

devotional1993

Sky King wrote: »

I have three tenants in rooms in my house.

I am trying to decide whether to pass on the €100 annual household charge (=€25 PPS including myself) or just take the hit myself.

I am curious as to what others in my position are doing.

I also would like to know if the ceiling of €10,000 of tax free rental income on the rent a room scheme is to be reduced. I havent seen anything on it, though I have looked.

Interested in opinions. Thanks.

Must be your religion- Orthadox tightarse I believe... I rent my property out but will pay it. Wouldnt dream of making a tenant pay.

Sky King

Thank you devotional for your helpful contribution to the debate and insightful analysis of my financial affairs.

Custardpi wrote: »

I'd say generally whether the charge gets passed on to tenants will vary from area to area. If your property is in an area where the supply of rentals (assuming quality is roughly equal) outstrips demand then you'll have to take the hit & vice-versa.

Indeed.

I feel it will almost certainly get passed on to tenants at some stage, albiet more indirectly, in terms of landlords jacking up rents simply because they have no choice with increasing costs and reduction of tax breaks such as 10k ceiling.

I was wondering if people were going to come straight out and say it though, moreso.

dory

I rent two rooms, really couldn't imagine asking the tenants to fork out for it.
It would be listed under 'cost of the house' so if you felt you needed to up the rent because of it fair enough. But they may just leave because of it so is it really worth it?

Custardpi

Sky King wrote: »

Thank you devotional for your helpful contribution to the debate and insightful analysis of my financial affairs.


Indeed.

I feel it will almost certainly get passed on to tenants at some stage, albiet more indirectly, in terms of landlords jacking up rents simply because they have no choice with increasing costs and reduction of tax breaks such as 10k ceiling.

I was wondering if people were going to come straight out and say it though, moreso.

Again that will only work if a landlord can be sure that the tenant can't rent a similar property for a lower price, regardless of what the landlord's personal finances are like. Keeping your own costs down is not really relevant if nobody wants to buy your product at the price you're charging.

Zamboni

Does anyone have the specific wording on the €100 property charge?

Sky King

Yes but costs will be increasing across the entire sector by €100 per annum leaving no-one with competitive advantage - my guess is that the going rate will creep up as a result of that, despite the fact that people here who rent rooms such as the magnanimous keyboard warrior devotional1993 are saying they won't.

Custardpi

Sky King wrote: »

Yes but costs will be increasing across the entire sector by €100 per annum leaving no-one with competitive advantage - my guess is that the going rate will creep up as a result of that, despite the fact that people here who rent rooms such as the magnanimous keyboard warrior devotional1993 are saying they won't.

The charge in & of itself won't give or reduce individual competitive advantage but some already have a competitive advantage based on their abilility to absorb higher costs eg: someone who is mortgaged to the hilt on a portfolio of rental properties vs someone who has a manageable mortgage or none at all on a property. In the former case the amount of increased charges that one can absorb before operating at a loss is obviously lower.

Victor

devotional1993 wrote: »

Must be your religion- Orthadox tightarse I believe

No need for comments like that.

Estebano

Just got off the phone to my letting agent. They said they are not passing on the €100 charge to tenants on their books. The landlord is the one who'll receive the bill, so he's the one who's liable. She said that their landlords are free to choose to increase rent at the end of their leases (mine is in June this year), but if he tries to do that, I'll simply laugh my head off.

HardyEustace

I rent 2 rooms and will be absorbing the cost myself.

My tenants are lovely and I am very fortunate in that would I would count them as friends at this stage. There is never any quibbles over bills, for the sake of 60euro a year, I think it would be very short sighted to try and wrest the money back and upset the goodwill and pleasant set up that we have.

If I do have to get someone new in for one of the rooms then I look at daft and go off the average room rate (vs. quality of house within a realistic target) rather than factor in all my external costs.

variety

Estebano wrote: »

Just got off the phone to my letting agent. They said they are not passing on the €100 charge to tenants on their books. The landlord is the one who'll receive the bill, so he's the one who's liable.

To be fair, this is a different situation to the OP's rent-a-room scheme in his own house.

The €100 charge does not apply to rental property; that's what the NPPR is for.
The vast majority of LLs didn't pass on the NPPR charge of €200 to Tenants, so why would they pass on a charge that is applicable to the house that the LL lives in??

The new Household charge is a charge for owners of a property, NOT for occupiers of a property.

Estebano wrote: »

She said that their landlords are free to choose to increase rent at the end of their leases (mine is in June this year), but if he tries to do that, I'll simply laugh my head off.

^^+1

loyatemu

variety wrote: »

Estebano wrote: »

Just got off the phone to my letting agent. They said they are not passing on the €100 charge to tenants on their books. The landlord is the one who'll receive the bill, so he's the one who's liable.

To be fair, this is a different situation to the OP's rent-a-room scheme in his own house.

The €100 charge does not apply to rental property; that's what the NPPR is for.
The vast majority of LLs didn't pass on the NPPR charge of €200 to Tenants, so why would they pass on a charge that is applicable to the house that the LL lives in??

The new Household charge is a charge for owners of a property, NOT for occupiers of a property.

Estebano wrote: »

She said that their landlords are free to choose to increase rent at the end of their leases (mine is in June this year), but if he tries to do that, I'll simply laugh my head off.

^^+1

Afaik it does apply to rented property and the owner is liable

mikemac1

One hundred euro to start with and once the database is up to date in a year or two it'll be jacked up no doubt

Same rules still apply.
If the landlord wants an increase, look around on daft. A landlord would be a fool to lose a good tenant over one hundred euro
And if you're looking at a new place the landlord probably worked it into the asking rent which is fair enough so you haggle. Haggle as hard as you can

variety

loyatemu wrote: »

Afaik it does apply to rented property and the owner is liable

I stand corrected.
Have just briefly scanned the new Act (http://www.oireachtas.ie/documents/bills28/bills/2011/7411/b7411s.pdf) and it does apply to every property (with a few exceptions, such as houseboats).

But, as before, it is a charge payable only by the owner of the property and not by the occupier.

Tayla

Sky King wrote: »

I have three tenants in rooms in my house.

I am trying to decide whether to pass on the €100 annual household charge (=€25 PPS including myself) or just take the hit myself.

I am curious as to what others in my position are doing.

I also would like to know if the ceiling of €10,000 of tax free rental income on the rent a room scheme is to be reduced. I havent seen anything on it, though I have looked.

Interested in opinions. Thanks.

You are liable to pay the tax, not your tenants. It says so in the legislation. Personally I'm refusing to pay but I definitely don't think it's right for you to charge the tenants.

not even wrong

My lease says this:

To pay promptly to the authorities or to whomever they are due, local authority, refuse charges and outgoings (including gas, water, electricity, cable television and telephone if any, relating to the property) including any which are imposed after the date of this Agreement (even if of a novel nature)

Am I liable to pay this charge? Is this clause in my lease enforceable if the charge is specifically imposed on the owner as opposed to the occupant?

Sky King

I won't refuse to pay any tax. I think this is a good tax and its taxes like these that allow business to keep their low corporation tax.

However I hadn't made a decision on how to go about getting the money as of this afternoon when I posted my query.

For example, I split the €160 TV license evenly between the four of us in the house... I think that this is fair since we all avail of the TV.

I felt it possible that this €100 could be seen as a 'house license' (for want of a better expression) and therefore split in the same way, since we all live in the house.

Now people in the thread seem to think that the responsibility lies solely with the owner of the house, which is fair enough, and one internet tough guy says I am a 'tight arse' for posting this query.

I was just seeking opinions is all...

Any word on the 10K tax ceiling for rental income on the home?

athtrasna

I don't think you should pass it on based on the simple fact that it's a charge you would have to pay anyway as the householder, whether you lived alone or have tenants in.

Tayla

not even wrong wrote: »

Am I liable to pay this charge? Is this clause in my lease enforceable if the charge is specifically imposed on the owner as opposed to the occupant?

No you're not liable for it according to the actual legislation so I would imagine that they wouldn't be allowed to force you to pay it, You will have to ring one of organisations who deal with tenants rights to find out.

Sky King wrote: »

However I hadn't made a decision on how to go about getting the money as of this afternoon when I posted my query.

For example, I split the €160 TV license evenly between the four of us in the house... I think that this is fair since we all avail of the TV.

Yes you all benefit from the tv but which of your tenants will benefit from paying the household tax? I mean i'm against people paying it full stop because who knows where it will lead to but for the people who are paying it then they shouldn't pass it on to tenants.