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House Extension and renting the new room

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    #32
    [Deleted User]
    Posts: 24,714 ✭ [Deleted User]


    Graham wrote: »
    It's not unusual for permission for 'granny-flats' to stipulate they cannot be rented as a separate dwelling.

    Self-contained suggests a property is being let as a separate dwelling.

    How can a a room under the same roof with an internal door be considered a separate dwelling, it makes no sense.

    As I said rent it as a room, tell the licensee that they will "more or less" have full use of the living room and kitchen on that side of the house but not exclusive, set the rent at what you want and if someone takes it then they are happy with the scenario.

    Also if it's a shared esb and gas connection I find it very hard to see how it can be considered a seperate dwelling.


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    #33
    konline
    Registered Users Posts: 314 ✭✭konline


    Hmm, thank you all for sharing your views. Provision for a door to the extension is there but i sealed it off. I can open it anytime. So let me ask the builder again.
    Any way thanks for all your valuable input.


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    #34
    Graham
    Moderators, Society & Culture Moderators Posts: 17,642 Mod ✭✭✭✭Graham


    Teagan Bumpy Greens wrote: »
    How can a a room under the same roof with an internal door be considered a separate dwelling, it makes no sense.

    As I said rent it as a room, tell the licensee that they will "more or less" have full use of the living room and kitchen on that side of the house but not exclusive, set the rent at what you want and if someone takes it then they are happy with the scenario.

    Also if it's a shared esb and gas connection I find it very hard to see how it can be considered a seperate dwelling.

    I find the easiest way to judge is to read the property description. The presence of the phrase 'self-contained' is usually the giveaway.


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    #35
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    OP- do whatever you have to do to put a connecting door from your kitchen (or whatever room is adjacent to the extension)- in asap.
    Without a connecting door- the rental income is taxable.
    With a connecting door- you have 14k tax free under the rent-a-room scheme.
    Its a no-brainer- put the damn door in.
    Your stepping into your garden to get to the room- means it is considered to be self contained- once it has this 'self contained' tag without a connecting door- its a rental property like any other rental property. The fact that its under the one roof- is wholly irrelevant- and a complete and utter red herring.

    Go, find a builder- and get a door put in. Don't think of letting the unit until you do this- or you'll be in the RTB tribunal process from a tenant or prospective tenant, for the foreseeable future.

    Use a proper builder for crying out loud- you don't want to cause structural issues either.


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    #36
    Browney7
    Registered Users Posts: 3,100 ✭✭✭Browney7


    This thread could have saved the OP thousands - move to Bargain Alerts?


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    #37
    konline
    Registered Users Posts: 314 ✭✭konline


    So all the garage conversions we see which are being rented will not fall under rent a room scheme, because landlord has to step out to access it?
    Revenue/RTB website doesn't say this.


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    #38
    Gumbo
    Moderators, Society & Culture Moderators Posts: 39,373 Mod ✭✭✭✭Gumbo


    konline wrote: »
    So all the garage conversions we see which are being rented will not fall under rent a room scheme, because landlord has to step out to access it?
    Revenue/RTB website doesn't say this.

    You haven't carried out a garage conversion. You've carried out and created a self contained flat.

    If Building Control were to get wind of it, they could chase you for a fire safety certificate and a disabled access certificate.


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    #39
    Cakerbaker
    Registered Users Posts: 850 ✭✭✭Cakerbaker


    konline wrote: »
    So all the garage conversions we see which are being rented will not fall under rent a room scheme, because landlord has to step out to access it?
    Revenue/RTB website doesn't say this.

    Citizens information says garage conversions fall under the RTB.


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    #40
    davindub
    Registered Users Posts: 1,447 ✭✭✭davindub


    konline wrote: »
    So all the garage conversions we see which are being rented will not fall under rent a room scheme, because landlord has to step out to access it?
    Revenue/RTB website doesn't say this.

    Garage conversion accepted to the RTB
    https://www.rtb.ie/archive/2010%20Disputes/Tribunals%202010/TR163.DR224.2010/Tribunal%20Report.pdf

    Rent a room relief is not based on the RTB rules. Revenue have their own criteria for the relief. But one of them is that if the property is detached from the main residence, the relief doesn't apply.


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    #41
    relax carry on
    Registered Users Posts: 4,081 ✭✭✭relax carry on


    Rent a room tax relief qualifying properties description:

    What type of residence qualifies?
    Sole or main residence
    Your main residence is your home for most of the year and where friends would expect to find you. You do not have to own the property to claim relief.

    The room or rooms must be in a residential property that is located in Ireland. You must use it as your main residence during the tax year.

    Self-contained unit
    The rented room or rooms can be a self-contained unit within the house, such as a basement flat or a converted garage. If this unit is not attached to the property it cannot qualify for the relief.

    Business use or guest accommodation
    Your tenants must use the room on a long-term basis. You cannot claim relief on rooms that are used for business purposes.

    Short-term stays provided through bed and breakfasts, a guesthouse or online booking sites do not qualify for relief.

    http://www.revenue.ie/en/personal-tax-credits-reliefs-and-exemptions/land-and-property/rent-a-room-relief/what-type-of-residence-qualifies.aspx


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    #42
    Claw Hammer
    Registered Users Posts: 6,238 ✭✭✭Claw Hammer


    The_Conductor wrote: »
    OP- do whatever you have to do to put a connecting door from your kitchen (or whatever room is adjacent to the extension)- in asap.
    Without a connecting door- the rental income is taxable.
    With a connecting door- you have 14k tax free under the rent-a-room scheme.
    Its a no-brainer- put the damn door in.
    Your stepping into your garden to get to the room- means it is considered to be self contained- once it has this 'self contained' tag without a connecting door- its a rental property like any other rental property. The fact that its under the one roof- is wholly irrelevant- and a complete and utter red herring.

    Go, find a builder- and get a door put in. Don't think of letting the unit until you do this- or you'll be in the RTB tribunal process from a tenant or prospective tenant, for the foreseeable future.

    Use a proper builder for crying out loud- you don't want to cause structural issues either.
    The connecting door is not necessary for taxation purposes. There is often no connecting door to a basement flat for example.


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    #43
    Gumbo
    Moderators, Society & Culture Moderators Posts: 39,373 Mod ✭✭✭✭Gumbo


    Claw Hammer wrote: »
    The connecting door is not necessary for taxation purposes. There is often no connecting door to a basement flat for example.

    But a basement flat will usually be in compliance with the planning, fire cert etc


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    #44
    Michael D Not Higgins
    Registered Users Posts: 7,223 ✭✭✭Michael D Not Higgins


    4ensic15 wrote: »
    If it is a self contained flat, it must be registered. there is provision to opt out of the notice provisions of the RTA but this must be done at the start of the tenancy. If it is under the same roof as the main house it may qualify for the Rent a room relief scheme.

    You can only opt out of Part 4 if the self contained part is part of the original build of the property, as per Section 25 (2) (b) of RTA 2004.


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    #45
    Claw Hammer
    Registered Users Posts: 6,238 ✭✭✭Claw Hammer


    kceire wrote: »
    But a basement flat will usually be in compliance with the planning, fire cert etc

    The Revenue are not interested in planning or fire safety. They allow relief according to their own criteria which does not involve checking fire of planning. they assume rightly or wrongly that the local authority will deal with those matters and there will be no letting at all to qualify for tax relief if the local authority do their job properly.


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    #46
    Michael D Not Higgins
    Registered Users Posts: 7,223 ✭✭✭Michael D Not Higgins


    Claw Hammer wrote: »
    The connecting door is not necessary for taxation purposes. There is often no connecting door to a basement flat for example.

    I'm not sure of the interpretation for basements for example but it may be true for some instances where the self contained part is part of the original build.

    I have very little faith in anyone arguing with Revenue over a new build onto the side/back of a house which is self contained as being part of the main residence.


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    #47
    Michael D Not Higgins
    Registered Users Posts: 7,223 ✭✭✭Michael D Not Higgins


    Claw Hammer wrote: »
    The Revenue are not interested in planning or fire safety. They allow relief according to their own criteria which does not involve checking fire of planning. they assume rightly or wrongly that the local authority will deal with those matters and there will be no letting at all to qualify for tax relief if the local authority do their job properly.

    There are a number of things here.

    Firstly, does it have planning permission? Planning enforcement can force rectification works or orders to prevent renting of non compliant builds.

    Secondly, does it qualify for tax relief? Without being part of the main residence, no it doesn't. As above, the accepted way of demonstrating it as part of the main residence is that it's accessible from within the main residence.

    Thirdly, what status is it for tenancy? Self contained, it's a tenancy. Connected internally, it's a licence.


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    #48
    [Deleted User]
    Posts: 17,728 ✭✭✭✭ [Deleted User]


    Claw Hammer wrote: »
    The rent a room scheme is operated by the Revenue Commissioners. They have a policy with regard to what they will accept for the purpose of tax relief.
    The status of the occupants is entirely different matter. It does not matter whether you are availing of the rent a room tax relief are not, the occupants may well be tenants and registration may be required. It is not the case that if you are in one you are automatically out of the other. There is a specific section in the Residential Tenancies Act dealing with multiunit dwellings where the landlord occupies one unit.
    It simply allows the landlord to act out some of the notice provisions. Registration of the other hassles apply. If it has a separate kitchen et cetera you will not be deemed to be living in the unit and the occupants will not be licensees. The question of access doors is irrelevant.

    Indeed, you can avail of the rent a room scheme from an income tax point of view "For 2017, the total (gross) rent that you get, which includes sums that the tenant pays for food, utilities, laundry or similar goods and services, cannot exceed €14,000 in the tax year (1 January to 31 December) – see ‘Exclusions from rent-a-room relief’ below"
    ................ while the rights and obligations under residential tenancies legislation apply to you as it's a Self-contained unit


    The below seems to be the status quo on here...........
    Michael D Not Higgins wrote: »
    ...............

    Secondly, does it qualify for tax relief? Without being part of the main residence, no it doesn't. As above, the accepted way of demonstrating it as part of the main residence is that it's accessible from within the main residence............
    .
    Graham wrote: »
    .....

    Self-contained suggests a property is being let as a separate dwelling.
    The_Conductor wrote: »
    ...........
    Your stepping into your garden to get to the room- means it is considered to be self contained- once it has this 'self contained' tag without a connecting door- its a rental property like any other rental property. The fact that its under the one roof- is wholly irrelevant- and a complete and utter red herring..........

    ............. incorrect IMO


    http://www.citizensinformation.ie/en/housing/owning_a_home/home_owners/rent_a_room_scheme.html

    ".....A self-contained unit, such as a basement flat or a converted garage attached to your home, can qualify for this relief" ............ the such as are two examples, not a full list of what is allowed.


    There is undoubtedly a source of confusion.........PRTB view such tenants in granny flats as tenants with associated rights, rather than licencees under Rent a Room. Revenue guidelines allow the income folks in self contained units to qualify under rent a room relief.


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    #49
    Michael D Not Higgins
    Registered Users Posts: 7,223 ✭✭✭Michael D Not Higgins


    Augeo wrote: »
    ............. incorrect IMO


    http://www.citizensinformation.ie/en/housing/owning_a_home/home_owners/rent_a_room_scheme.html

    ".....A self-contained unit, such as a basement flat or a converted garage attached to your home, can qualify for this relief" ............ the such as are two examples, not a full list of what is allowed.

    This says it can qualify for relief not necessarily that it will. The relevant legislation is the TCA 1997 as amended which requires the qualifying residence to be the residential premises of the individual in which the room or rooms are rented. The residential premises is a building or part of a building used as a dwelling.

    Note the use of a singular dwelling. You cannot have a separate dwelling qualify for rent a room relief. There may be an argument for non-connected self contained parts such as a basement flat if it's considered part of the original residential premises but I'm not sure what arguments Revenue accept on that behalf.


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    #50
    Claw Hammer
    Registered Users Posts: 6,238 ✭✭✭Claw Hammer


    Michael D Not Higgins wrote: »
    This says it can qualify for relief not necessarily that it will. The relevant legislation is the TCA 1997 as amended which requires the qualifying residence to be the residential premises of the individual in which the room or rooms are rented. The residential premises is a building or part of a building used as a dwelling.

    Note the use of a singular dwelling. You cannot have a separate dwelling qualify for rent a room relief. There may be an argument for non-connected self contained parts such as a basement flat if it's considered part of the original residential premises but I'm not sure what arguments Revenue accept on that behalf.

    The Revenue operate an "under the same roof" policy. I.E. The entire is within the same envelope. A unit such as a distinct mews will not be accepted.


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    #51
    [Deleted User]
    Posts: 17,728 ✭✭✭✭ [Deleted User]


    Michael D Not Higgins wrote: »
    This says it can qualify for relief not necessarily that it will. The relevant legislation is the TCA 1997 as amended which requires the qualifying residence to be the residential premises of the individual in which the room or rooms are rented. The residential premises is a building or part of a building used as a dwelling.

    Note the use of a singular dwelling. You cannot have a separate dwelling qualify for rent a room relief. There may be an argument for non-connected self contained parts such as a basement flat if it's considered part of the original residential premises but I'm not sure what arguments Revenue accept on that behalf.

    A self contained unit which is an extension onto a residence is undoubtedly part of that residence. The address is the same. It's covered under the property tax etc...... it's part of the residential premises of the owner.

    No one is trying to palm off a semi d here.


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    #52
    Michael D Not Higgins
    Registered Users Posts: 7,223 ✭✭✭Michael D Not Higgins


    Augeo wrote: »
    A self contained unit which is an extension onto a residence is undoubtedly part of that residence. The address is the same. It's covered under the property tax etc...... it's part of the residential premises of the owner.

    No one is trying to palm off a semi d here.

    In that case, it's likely to require planning permission if you intend to rent it to someone. There's a reason why these kinds of things aren't common.


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    #53
    [Deleted User]
    Posts: 17,728 ✭✭✭✭ [Deleted User]


    Michael D Not Higgins wrote: »
    In that case, it's likely to require planning permission if you intend to rent it to someone. There's a reason why these kinds of things aren't common.

    Maybe it is maybe it isn't.
    Who decides?
    How long after building an extension can you decide to rent the self contained unit out?

    etc etc etc

    The reason these kind of things aren't common is that in years gone by you had bedsits and ample other rental properties. Now you don't.


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    #54
    Michael D Not Higgins
    Registered Users Posts: 7,223 ✭✭✭Michael D Not Higgins


    Augeo wrote: »
    Maybe it is maybe it isn't.
    Who decides?
    How long after building an extension can you decide to rent the self contained unit out?

    etc etc etc

    The reason these kind of things aren't common is that in years gone by you had bedsits and ample other rental properties. Now you don't.

    I was speaking conversationally. It does need planning permission. The only way in the planning that I know of to build one of these types of things is as a granny flat with conditions that it can only be lived in by a relative who needs it with a 7 year limit on permission before it must be reverted into use by the main house again (unless a further need of the granny flat is demonstrated).

    If you know of another way of getting planning permission for this kind of development then I'd like to hear it otherwise you're just guessing to support your claim.


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    #55
    [Deleted User]
    Posts: 17,728 ✭✭✭✭ [Deleted User]


    Michael D Not Higgins wrote: »
    ..............

    If you know of another way of getting planning permission for this kind of development then I'd like to hear it otherwise you're just guessing to support your claim.

    You make it sound like getting planning permission is a huge mission.
    If the intent was to build an extension that is to be a self contained unit than planning permission shouldn't be an issue......... presuming access etc is up to scratch.


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    #56
    Michael D Not Higgins
    Registered Users Posts: 7,223 ✭✭✭Michael D Not Higgins


    Augeo wrote: »
    You make it sound like getting planning permission is a huge mission.
    If the intent was to build an extension that is to be a self contained unit than planning permission shouldn't be an issue......... presuming access etc is up to scratch.

    You just won't get permission though. They don't allow that kind of development which is why there's such conditions around granny flats.


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    #57
    [Deleted User]
    Posts: 17,728 ✭✭✭✭ [Deleted User]


    Michael D Not Higgins wrote: »
    You just won't get permission though. They don't allow that kind of development which is why there's such conditions around granny flats.

    I would guess the OP got planning permission which is why provision for a door to the extension is there
    konline wrote: »
    Hmm, thank you all for sharing your views. Provision for a door to the extension is there but i sealed it off. I can open it anytime. So let me ask the builder again.
    Any way thanks for all your valuable input.

    Anyway to summarise
    Planning - potentially dodgy
    Revenue - no problem with this being self contained and rent a room relief
    PRTB - might not be inclined to view the "tenant" as a licensee.


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    #58
    Claw Hammer
    Registered Users Posts: 6,238 ✭✭✭Claw Hammer


    Augeo wrote: »
    I would guess the OP got planning permission which is why provision for a door to the extension is there



    Anyway to summarise
    Planning - potentially dodgy
    Revenue - no problem with this being self contained and rent a room relief
    PRTB - might not be inclined to view the "tenant" as a licensee.

    RTB will certainly not view the tenant as a licensee. Not alone that the o/p if he wants to avoid the notice provisions will have to give a notice to the tenants at the start.


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    #59
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    Just to clarify here guys- it is far from unusual for Revenue and the RTB to take opposing viewpoints in situations like this- it is incredibly common for one to see a tenancy and the other not...........


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    #60
    [Deleted User]
    Posts: 24,714 ✭ [Deleted User]


    Claw Hammer wrote: »
    RTB will certainly not view the tenant as a licensee. Not alone that the o/p if he wants to avoid the notice provisions will have to give a notice to the tenants at the start.

    Is there any case where the RTB have ruled that a person living in the same house as the owner but where they happen to have use of a second kitchen and living room but the owner can still freely walk in and use either through the internal door has been ruled a tenancy? Where also the esb, gas, phoneline/broadband is also shared?

    No would be my guess as they simply have no argument in favour of it being a tenancy.


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    #61
    Gumbo
    Moderators, Society & Culture Moderators Posts: 39,373 Mod ✭✭✭✭Gumbo


    Michael D Not Higgins wrote: »
    You just won't get permission though. They don't allow that kind of development which is why there's such conditions around granny flats.

    100% correct.
    Augeo wrote: »
    You make it sound like getting planning permission is a huge mission.
    If the intent was to build an extension that is to be a self contained unit than planning permission shouldn't be an issue......... presuming access etc is up to scratch.

    It is a mission. You will. It get permission for a self contained unit in an urban or rural setting here in ireland. The best you can hope for is a granny flat but it must contain a permanent link to the main dwelling.
    Augeo wrote: »
    I would guess the OP got planning permission which is why provision for a door to the extension is there
    .

    Probably has permission for the granny flat but they have blatently stated that they are blocking the permanent door up so you have to leave the dwelling to enter the extension.


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