Primary residence

craicfox

Hi,
I'm currently on a tracker mortgage but thinking of living abroad. I see from the paperwork that my house has to be my primary residence or else they can cancell my tracker.
Does anyone know exactly how many months of the year I have to be in the house to maintain it as my primary residence and if these rules still apply if I'm living abroad.
Ideally I'd like to spend half the year working on the continent and then the rest working back here. If I stayed in my own home for those six months and then rented all the rooms while I'm away would I still be able to keep my tracker.

All advice greatly appreciated

lexa

Depends on what is in your contract. It sounds like your bank may have the right to cancel the tracker, but whether they would or not is a different story.

Also does it state principle private residence in your contract? Is it defined?

Under Revenue rules for capital gains tax, the last 12 months are deemed to be a period of occupation. If an individual has to live abroad for part of the period of ownership, for work purposes, the period away will be deemed to be “occupation” provided he returns to the property after the secondment abroad.
I wonder would the same be true for your mortgage?

There are a lot of things to consider other than the bank as well.
House insurance, you need to make sure your policy covers rental, register as a landlord with PRTB, revenue issues such as TRS and tax on rental income, CGT on a sale in the future (apportioned for the time you were absent)

The only way of knowing for sure is by writing to the bank and getting an answer from them in writing. Or you could just go ahead and do it and not inform the bank but this is dishonest and you may get caught out.

cookie1977

and the NPPR tax

craicfox

lexa wrote: »

Depends on what is in your contract. It sounds like your bank may have the right to cancel the tracker, but whether they would or not is a different story.

Also does it state principle private residence in your contract? Is it defined?

Under Revenue rules for capital gains tax, the last 12 months are deemed to be a period of occupation. If an individual has to live abroad for part of the period of ownership, for work purposes, the period away will be deemed to be “occupation” provided he returns to the property after the secondment abroad.
I wonder would the same be true for your mortgage?

There are a lot of things to consider other than the bank as well.
House insurance, you need to make sure your policy covers rental, register as a landlord with PRTB, revenue issues such as TRS and tax on rental income, CGT on a sale in the future (apportioned for the time you were absent)

The only way of knowing for sure is by writing to the bank and getting an answer from them in writing. Or you could just go ahead and do it and not inform the bank but this is dishonest and you may get caught out.

Christ this is alot more complex than I thought, and as much as I might like the idea of just doing it and saying nothing, I think I'll take your advice and write to the bank and see what they come back with.
I suppose depending on what they say, I can then look into sorting out my house insurance and registration with PRTB etc.

Thanks again for getting back to me

rodneytrotter15

I'm not advising you to do it but my brother is in Australia for the last 3 years he is also supposed to be living in his house as advised by Lexa. Obviously he isn't and hasn't told them that he isn't either ditto TRS payment. The reality is as long as the bank is getting paid and the mortgage isn't in arrears do they really give a sh*t the way things are today ?
If you could get "nice" tenants to lodge the cash into your mortgage the bank would definitely be none the wiser. I would definitely check out the insurance though.

chris85

OP there is also issue of insurance. Your property is most likely insured as a owner occupied property so if something happens and turns out not owner ocupied then insurance could be void.

Changing the insurance to non owner occupied will result in the insurance company notifying the mortgage lender to changes in the policy as they have a vested interest in the property and would need to be informed of it.

lexa

Craicfox,As you acknowledged there is a lot to consider. If you are only planning on being away for a few months of the year, I think it's unlikely you'd lose the PPR status.If you are away for a few years, there are lots of issues.But best to check

Marcusm

rodneytrotter15 wrote: »

I'm not advising you to do it but my brother is in Australia for the last 3 years he is also supposed to be living in his house as advised by Lexa. Obviously he isn't and hasn't told them that he isn't either ditto TRS payment. The reality is as long as the bank is getting paid and the mortgage isn't in arrears do they really give a sh*t the way things are today ?
If you could get "nice" tenants to lodge the cash into your mortgage the bank would definitely be none the wiser. I would definitely check out the insurance though.

Hmmm, your brother is committing at least one, probably more, revenue offences and you'd like to encourage the OP to do the same.