Landlords - Revenue campaign to claw back mortgage interest relief

CreepingDeath

Hi,

just a heads up, that the revenue seem to be going through a campaign (at least in Louth, as we heard of 2 others) to claw back any mortgage interest relief that was accidentally paid out on rental properties (non principal private residences)

Myself and the missus became accidental landlords with a 2nd house in 2011, renting out privately for a while, then entered a long term lease agreement with Louth County council in 2015. (Which required jumping through all sorts of property checks, tax clearance, permission from building society etc)

Long story short, the missus didn't know she had to cancel the mortgage interest relief in 2011 when she moved out, PTSB cancelled it automatically in 2015 when we got permission from them to lease out the property to the council)

Now hit with a backdated €3500-€4000 tax bill for 2011-2015.

The few I heard aren't/can't pay it back all at once, so a lump sum then some for of payment plan.

But could be pricey if you don't expect it. But just raising awareness.
We had properly registered with the PRTB in 2011, just missed the mortgage interest relief cancellation as newbie landlords.

regards,
CD

Samuel T. Cogley

Are you talking about TRS - what was the clawback? Just for the TRS or for the interest relief too?

Lux23

I love this accidental landlord expression. I accidentally bought some property, which I accidentally rented out. Doesn't matter how you came to be a landlord, you're still subject to the same obligations.

emeldc

Lux23 wrote: »

I love this accidental landlord expression. I accidentally bought some property, which I accidentally rented out. Doesn't matter how you came to be a landlord, you're still subject to the same obligations.

I don't think the OP is looking for sympathy or denying that he should be bound by the same rules as everyone else.
I also think that you don't understand the term 'accidental landlord'.

Lux23

I do understand it, those in negative equity who can't sell etc. But I think its used an excuse not to read up on your obligations.

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andekwarhola

Lux23 wrote: »

I do understand it, those in negative equity who can't sell etc. But I think its used an excuse not to read up on your obligations.

The OP reads like they made a genuine mistake and accept it, and are advising others of the consequences.

You sound worked up about landlords generally perhaps. Not the OP's problem tbh.

CreepingDeath

Lux23 wrote: »

I love this accidental landlord expression. I accidentally bought some property, which I accidentally rented out. Doesn't matter how you came to be a landlord, you're still subject to the same obligations.

As others have said... was never our intention to be landlords.
Two single people with houses & mortgages get together, suddenly you've a surplus house ( in negative equity at the time ). And nobody will sell their own house until after marriage etc, when their circumstances are secure.

We rented the wifes house privately to start with, but our first tenant who worked on the trawlers ran up a €1000+ gas bill somehow in 6 months.... but luckily I had the good sense to insist up front they put the bills in their name.

Anyways... it was a genuine oversight.

I'm just raising awareness that accidental or deliberate, there's a revenue campaign to detect and backdate/clawback any overpayment.

I know there's no defense, not looking for sympathy... and I done no more than shake my head at the missus, but we can deal with it.

Only raising awareness.

regards,
CD

CreepingDeath

Samuel T. Cogley wrote: »

Are you talking about TRS - what was the clawback? Just for the TRS or for the interest relief too?

Yes. Just TRS and no penalties mentioned.

Might have to prove you're not liable for the full year as the missus only moved out in mid November 2011 so not liable for all the TRS payments for all of 2011.

CIARAN_BOYLE

I had a few cases last year where Revenue sought to claw back TRS wrongly claimed.

Did they just claw back the liability that you got or impose interest and penalties? Given that Revenue can charge upto 10% per annum on late taxes and 30% penalty on wrongful returns you may have gotten off very lucky.

Samuel T. Cogley

CreepingDeath wrote: »

Yes. Just TRS and no penalties mentioned.

Might have to prove you're not liable for the full year as the missus only moved out in mid November 2011 so not liable for all the TRS payments for all of 2011.

Very much obliged. To add to this, I've a law degree which included revenue law, I'm regularly kept well informed by posters here and I did exactly the same bloody thing and the first I remembered of it was your post.

I can hardly hold myself out as an example in any respect, but you/she was not the only one!

CreepingDeath

CIARAN_BOYLE wrote: »

I had a few cases last year where Revenue sought to claw back TRS wrongly claimed.

Did they just claw back the liability that you got or impose interest and penalties? Given that Revenue can charge upto 10% per annum on late taxes and 30% penalty on wrongful returns you may have gotten off very lucky.

Just the liability. We had properly registered with PRTB, so maybe if we hadn't it would've looked worse.

On the other hand... maybe the revenue are joining the TRS and PRTB databases together to see if there's any overlap between people renting and claiming.

CIARAN_BOYLE

CreepingDeath wrote: »

Just the liability. We had properly registered with PRTB, so maybe if we hadn't it would've looked worse.

On the other hand... maybe the revenue are joining the TRS and PRTB databases together to see if there's any overlap between people renting and claiming.

Revenue have been improving their database links with other public bodies in recent years so maybe.

Just be happy you dodged the bullet that is interest and penalties.

Lux23

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And is tax not legislated?

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Onthefence

Thanks to the OP for raising awareness of this last month. I got my clawback request from Revenue this morning. Not pleasant but at least it wasn't a bolt out of the blue.