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Rental income

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  • 16-02-2012 8:52pm
    #1
    studdlymurphy
    Registered Users Posts: 827 ✭✭✭


    Hi All,
    My wife owns an apartment which is pretty much paid off 20k left and we are moving into a new house soon so will rent the apartment out. She does not work but I do. what way will the rental income work in that situation? we are hoping to get about 600euro a month for the property.
    We will be going to an accountant but would like to have an Idea before speaking to one.
    Thanks for the help


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    #2
    3DataModem
    Registered Users Posts: 3,997 ✭✭✭3DataModem


    studdlymurphy wrote: »
    Hi All,
    My wife owns an apartment which is pretty much paid off 20k left and we are moving into a new house soon so will rent the apartment out. She does not work but I do. what way will the rental income work in that situation? we are hoping to get about 600euro a month for the property.
    We will be going to an accountant but would like to have an Idea before speaking to one.
    Thanks for the help

    As there is virtually no mortgage interest to speak of, she will pay full whack income tax on the rent, less expenses (repairs, agent fees, accountant fees, management fee, etc).


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    #3
    studdlymurphy
    Registered Users Posts: 827 ✭✭✭studdlymurphy


    Does that mean like paye 20% then USC then PRSI etc?
    Does the tax credits come into effect also?
    Thanks again


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    #4
    relax carry on
    Registered Users Posts: 4,079 ✭✭✭relax carry on


    studdlymurphy wrote: »
    Does that mean like paye 20% then USC then PRSI etc?
    Does the tax credits come into effect also?
    Thanks again

    When you file your income tax return, all your sources of income are taken into account to work out your liability. So if you are joint assessed and you are using up your tax credits + your wifes transferable credits and cut off on other income (salary, pension etc) you will not be able to use any to reduce the tax due. Also depending on if your wife has any other incomes, the tax due on the rental income might be due at 41% + PRSI + USC. The link below will be of use to you.


    http://www.revenue.ie/en/tax/it/leaflets/it70.html

    Edit: post altered as missed OPs point about wife not working.


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