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Adult Children's Contribution to Household Expenses - is this taxable extra income?

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  • 13-11-2014 9:08am
    #1
    JuliusCaesar
    Registered Users Posts: 4,882 ✭✭✭


    Given the furore of yesterday's news that providing a place to stay (in the family home) to adult children might be classed as some sort of benefit-in-kind, and those adult children may be taxed on it, I started wondering if the payments made by those children into the household might be classed as Extra Income for the parents.

    Could the parents then be taxed on it?

    Or would the children be regarded as lodgers and be tax-free, so long as the contributions stay below €10K a year?

    Anyone know?
    Tagged:


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    #2
    Arbiter of Good Taste
    Registered Users Posts: 2,200 ✭✭✭Arbiter of Good Taste


    I would have thought that by having the children pay food etc would reduce their tax risk of a taxable benefit. I really didn't think about the other side of the equation.

    If we were being pedantic, I would say the parents would be taxable, but would seek to deduct the actual cost incurred of the food. Nightmare, and just impractical.

    To be honest I can't see how this will be enforced. Is it really in the taxpayers', and society's, interest for, say, more people on the housing lists because stating with their parents creates tax issues? What happens in the reverse scenario? If a person gets too old to look after themselves and moves in with one of their adult children, will that old person now be taxable on the "benefit"?

    My feeling is that Revenue won't enforce this, except for extreme cases.


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    #3
    2ndcoming
    Registered Users Posts: 3,572 ✭✭✭2ndcoming


    That was a very misleading article for the "paper of record". The notion was basically rubbished by the Revenue spokesperson in the body of the article, but that didn't stop them getting a nice clickworthy sensationalist headline out of it.


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    #4
    JuliusCaesar
    Registered Users Posts: 4,882 ✭✭✭JuliusCaesar


    yes, I know; but the question here is can the PARENTS be taxed on the 'extra income' from their adult children who are contributing towards the household expenses?


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    #5
    barneystinson
    Registered Users Posts: 4,683 ✭✭✭barneystinson


    JuliusCaesar wrote: »
    yes, I know; but the question here is can the PARENTS be taxed on the 'extra income' from their adult children who are contributing towards the household expenses?

    No, because it's not an income.

    If we go to a restaurant and I insist on paying, but then afterwards you insist on giving me €30 to cover yours, that ain't income.

    As 2ndcoming says above, if you actually read what Maurice O'Donoghue of Revenue is quoted as saying, you'll see this is all a storm in a teacup...


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    #6
    Gard1
    Registered Users Posts: 90 ✭✭Gard1


    think parents could qualify for rent a room relief...................


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    #7
    dogsears
    Registered Users Posts: 535 ✭✭✭dogsears


    Gard1 wrote: »
    think parents could qualify for rent a room relief...................

    Absolutely not. Even if this was income, which it isn't as correctly stated above, rent a room relief cannot apply to rent paid to parents by children.


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