Hap Accepted - Landlords

draiochtanois

This post has been deleted.

dubrov

draiochtanois wrote: »

This post has been deleted.

Thanks. Looks like it is exactly a tax on profit then :pac:

Samuel T. Cogley

dubrov wrote: »

Thanks. Looks like it is exactly a tax on profit then :pac:

It's not, it's a tax on the income. When you write off against tax you're writing off part of the cost, not the entire cost. You're suggesting it breaks down like this:

Income 12,000
M.Cap 3,000
M.Int 1,500
Man Fee 1,300
Maintenance 500
Profit 5,700
Tax @ 52% = 2,964
Net income = 2,736 (More if your suggesting write offs on the above figure)

It breaks down like this:

Income 12,000
M.Cap 3,000
M.Int 1,500
Man Fee 1,300
Maintenance 500
Tax Liability = 6,240
Less:
M.Int @ 80%=1,200
M.Fee =1,300
Maintenance = 500
Net Tax Liability = 3,240

That has to be fed back in


Income 12,000
3,000
1,500
1,300
500
3,240
=2,460

GGTrek

dubrov wrote: »

draiochtanois wrote: »

And if the tenant is participating in the HAP scheme 100% of interest can be written off :pac:

Thanks. Looks like it is exactly a tax on profit then :pac:

Income tax is more or less on profit (a few expenses like LPT cannot be claimed), but USC is almost fully on Income (for example wear&tear cannot be claimed against USC).

Samuel T. Cogley

GGTrek wrote: »

Income tax is more or less on profit (a few expenses like LPT cannot be claimed), but USC is almost fully on Income (for example wear&tear cannot be claimed against USC).

Again on profit suggests that the tax is levied on the gross profit and then write offs are applied, that's a very easy misconception to leap to fore people not used to the calculations.

dubrov

Samuel T. Cogley wrote: »

It's not, it's a tax on the income. When you write off against tax you're writing off part of the cost, not the entire cost. You're suggesting it breaks down like this:

Income 12,000
M.Cap 3,000
M.Int 1,500
Man Fee 1,300
Maintenance 500
Profit 5,700
Tax @ 52% = 2,964
Net income = 2,736 (More if your suggesting write offs on the above figure)

It breaks down like this:

Income 12,000
M.Cap 3,000
M.Int 1,500
Man Fee 1,300
Maintenance 500
Tax Liability = 6,240
Less:
M.Int @ 80%=1,200
M.Fee =1,300
Maintenance = 500
Net Tax Liability = 3,240

That has to be fed back in


Income 12,000
3,000
1,500
1,300
500
3,240
=2,460

You have conveniently left out the capital repayment of 3,000 from your profit.
Cashflow and profit are not the same.

Cuddlesworth

While your here, could somebody do my 2017 returns?

what2do

amcalester wrote: »

Nomis21 wrote: »

I am a tenant of 7 years who was moved onto HAP from RA. Now after 2 years on HAP the council have inspected the property and are demanding 10K Euro of repairs be made to the property within 6 months or payment will stop. My Landlord says he does not have the money for these repairs and I am happy to live in the property as it is.

The Landlord doesn't care. In this rental climate he can easily find a cash tenant and not gave to worry about inspections of the property and probably get more rent as well.

So HAP might have the effect of making me homeless. The Council never told me that might happen when I signed up for HAP.

Out of curiosity what are the repairs that need to be made?

Do they go over and above the minimum standards as set out here?

I’ve been issued with a list of things that’s need to be done to comply with their ‘standards’- this included ETCI inspection report for electricity, similar report for heating, docs explaining where main stop valve is.... and a few other things I can’t remember off the top of my head.

This seems unnecessary hassle- 10 yr old house...... don’t have these for where I live!

On the other hand rent has been paid on time every month (so far)

circular flexing

dubrov wrote: »

The only expense you can't fully write off is interest and even then 80% can be written off. So tax is levied more or less on profit.

You can't claim for LPT or any insurance policy on the mortgage.

You also can only claim 100% interest relief after 3 years of renting to social welfare tenants.

Edit: You can claim mortgage protection policies, I think this is a new thing https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-04/04-08-09.pdf

Spanish Eyes

It would appear to me that REITS is what the Government wants to run the rental market now.

Even though they do not pay anything like a non REIT in tax. Maybe none in fact!

I wonder why that is? Does anyone know.... but it seems to be the creeping policy now.

If I had a property to let, I would (if I knew how!) approach these entities and let them take care of it for me, let them sub let it, maintain it, evict etc. and deal with all the grief, and give me the profit for my own tax returns.

Topdolla

So do any of the 12 landlords that said yes want to let to me? :rolleyes:

Hopefully more landlords get on board with it anyways, and it looks like my only option is to rent a room in a shared house until this country sorts out the housing crisis.

Cuddlesworth

Topdolla wrote: »

So do any of the 12 landlords that said yes want to let to me? :rolleyes:

Hopefully more landlords get on board with it anyways, and it looks like my only option is to rent a room in a shared house until this country sorts out the housing crisis.

Whats wrong with renting a room? I did it for a decade.

davo10

Topdolla wrote: »

So do any of the 12 landlords that said yes want to let to me? :rolleyes:

Hopefully more landlords get on board with it anyways, and it looks like my only option is to rent a room in a shared house until this country sorts out the housing crisis.

In a market with more prospective tenants than landlords, you will have to accept that you are the least appealing applicant. Such is the situation.

murphaph

draiochtanois wrote: »

And if the tenant is participating in the HAP scheme 100% of interest can be written off :pac:

It's not that straightforward. You have to make a declaration to the RTB in advance that the property will be let to social tenants for at least 3 years and after the entire period you can put the missing interest through your tax return. I doubt many landlords at all are making use of this allowance.

Nomis21

amcalester wrote: »

Nomis21 wrote: »

I am a tenant of 7 years who was moved onto HAP from RA. Now after 2 years on HAP the council have inspected the property and are demanding 10K Euro of repairs be made to the property within 6 months or payment will stop. My Landlord says he does not have the money for these repairs and I am happy to live in the property as it is.

The Landlord doesn't care. In this rental climate he can easily find a cash tenant and not gave to worry about inspections of the property and probably get more rent as well.

So HAP might have the effect of making me homeless. The Council never told me that might happen when I signed up for HAP.

Out of curiosity what are the repairs that need to be made?

Do they go over and above the minimum standards as set out here?

Ventilation and heating in bedrooms, damp, electrics, no shower and hot water only by immersion heater amongst other issues. It is a 200 year old cottage and I am happy how it is but my input is not important. Homelessness by HAP beckons...

Nomis21

Minimum standards and HAP standards are two different things...

Topdolla

Topdolla wrote: »

So do any of the 12 landlords that said yes want to let to me? :rolleyes:

Hopefully more landlords get on board with it anyways, and it looks like my only option is to rent a room in a shared house until this country sorts out the housing crisis.

If we had no shortage of houses or apartments HAP should not pay for a single working person to live alone, rent a room until you can afford to rent alone yourself (or afford to buy your own place) like the vast majority of the country have to do.

murphaph

Nomis21 wrote: »

Minimum standards and HAP standards are two different things...

I think they've converged now. I had a RAS inspection at the behest of the council (private company contracted to the council) at the start of this year and the few defects listed were all cited as breaches of the standards in rented accommodation act 2017. Stuff like CO detector missing in sitting room (open fireplace).

Even though the house is exiting the RAS now I will remedy the issues outlined to be compliant.

karenalot

Nomis21 wrote: »

Ventilation and heating in bedrooms, damp, electrics, no shower and hot water only by immersion heater amongst other issues. It is a 200 year old cottage and I am happy how it is but my input is not important. Homelessness by HAP beckons...

There are plans for local authorities to start inspecting 25% of all rentals a year. Even without hap tenants most landlords should expect a visit once every 4 years. It will mean a lot of properties having to be brought up to standards.

VonBeanie

karenalot wrote: »

There are plans for local authorities to start inspecting 25% of all rentals a year. Even without hap tenants most landlords should expect a visit once every 4 years. It will mean a lot of properties having to be brought up to standards.

It will mean a lot of properties being taken off the market. Landlords are already selling up. Who is going to invest thousands of Euro in upgrades?

karenalot

VonBeanie wrote: »

It will mean a lot of properties being taken off the market. Landlords are already selling up. Who is going to invest thousands of Euro in upgrades?

It's a tough one, on one hand I agree that properties should have min standards and regular inspections because as a fully compliant landlord who looks after their properties I am sick of the slum ones. However in the middle of a housing crisis making landlords begrudgingly install extra vents is not the kind of help renters need right now.

Back to the op's original question. It seems that quite a number of landlords do rent to hap tenants. 142 million was spent on the scheme last year. Almost three times the 2016 figure.

https://www.irishtimes.com/news/social-affairs/payments-to-landlords-surge-as-social-housing-scheme-rolled-out-1.3370076

Nomis21

murphaph wrote: »

I think they've converged now.

Good thing. Otherwise a Landlord can refuse to do repairs for a HAP tenant and then after HAP stop paying and the tenant is evicted, he would still be allowed to rent on the open market to non-HAP tenants.

I'm not sure that is actually not possible as things are though...

murphaph

Nomis21 wrote: »

Good thing. Otherwise a Landlord can refuse to do repairs for a HAP tenant and then after HAP stop paying and the tenant is evicted, he would still be allowed to rent on the open market to non-HAP tenants.

I'm not sure that is actually not possible as things are though...

To be honest the verification process seems to be shambolic. My letter from the contracted inspector says they will check with my tenant if the issues have been addressed. No talk of actual reinspection.

The_Conductor

murphaph wrote: »

To be honest the verification process seems to be shambolic. My letter from the contracted inspector says they will check with my tenant if the issues have been addressed. No talk of actual reinspection.

A CO detector- is a requirement even in an owner occupied house- and its a bit unusual that it was overlooked.

HAP requirements- are akin to current building regulations- and they are trying to shoehorn current building regs into older buildings.

There is no excuse whatsoever not to have a CO detector in a property with gas heating or an open fireplace- an outside vent in any habitable room- is however, an entirely different issue- esp when the standards in place when a lot of buildings were constructed- explicitly allowed in-frame ventillation systems (and this was the norm between 1988 and 1996.

Its admirable that building standards are as high now- as they are- however, trying to shoehorn today's building standards into properties that were fully compliant with the then standards when they were built 20 (or more) years ago- is simply an exercise in getting landlords to spend money.

I posed this question to the Minister by e-mail some time ago- and his office desperately tried to avoid addressing my question by stating that my question was in fact a tax question- whether I realised it or not- and thus the Minister for Housing is not the competent authority to address my question to.

Separately I posed the question- from a tax perspective- to the Revenue Commissioners. They were not willing to respond to my question in writing- but did state verbally- that upgrades such as I detailed (installing 4 external vents in habitable rooms, rewiring the bathroom and a small shopping list of other 'standards' were in fact considered to be an improvement by the Revenue Commissioners- and thus none of the costs incurred would be allowable in a tax return- as the landlord would be able to increase the rent associated with the property to reflect the enhanced utility such improvements would add to a property...........

So- in short- the government departments aren't talking to one another (quelle suprise)- and the landlord is both obligated to undertake the improvements if he/she wishes to be compliant for a HAP tenant- and is obliged to undertake these 'improvements' at their own cost...........

Now for good measure- according to Philip- the tenants are self-certifying that the identified works have occurred. Jesus wept.

murphaph

Just to be clear...there was one CO detector in the property but they wanted a second covering the never used open fireplace in the sitting room.

I've had a CO detector in place for the gas boiler since before they were added to the regs.

quadrifoglio verde

murphaph wrote: »

Just to be clear...there was one CO detector in the property but they wanted a second covering the never used open fireplace in the sitting room.

I've had a CO detector in place for the gas boiler since before they were added to the regs.

Feck sake a fire place that is never used. They're lunatics.
Just place a sheet of mdf over it :pac:

Nomis21

The_Conductor wrote: »

So- in short- the government departments aren't talking to one another (quelle suprise)- and the landlord is both obligated to undertake the improvements if he/she wishes to be compliant for a HAP tenant- and is obliged to undertake these 'improvements' at their own cost...........

Now for good measure- according to Philip- the tenants are self-certifying that the identified works have occurred. Jesus wept.

So the Revenue are saying that the Landlord can raise the rent after the improvements?

That is doubtful. I can't imagine a HAP tenancy where the Landlord is not already receiving the maximum allowed rent and so in fact he would have to get the money from the tenant for any rent increase, in effect making the tenant pay for the statutory repairs.

The_Conductor

Nomis21 wrote: »

So the Revenue are saying that the Landlord can raise the rent after the improvements?

That is doubtful. I can't imagine a HAP tenancy where the Landlord is not already receiving the maximum allowed rent and so in fact he would have to get the money from the tenant for any rent increase, in effect making the tenant pay for the statutory repairs.

Yep- Revenue classify it as 'an improvement' and thus the stated reason that you can't offset the cost of the improvements against rental income as a 'cost'- is because- as its an improvement- you can simply get the cost back through a higher rental letting charge.

Honestly- they're not talking to one another- and the lady in Revenue I was talking to- openly admitted she had never heard of an RPZ- and sure, why would it have anything to do with improving a property.............

No wonder- after putting me on hold for 2 minutes- she said she stood over what she had told me, but she trusted that I understood she couldn't put it in writing.................

They're either not talking to one another- or quite simply- are out to undermine one another- however, its safer to ascribe their actions to stupidity rather than maliciousness.

murphaph

The_Conductor wrote: »

Yep- Revenue classify it as 'an improvement' and thus the stated reason that you can't offset the cost of the improvements against rental income as a 'cost'- is because- as its an improvement- you can simply get the cost back through a higher rental letting charge.

Honestly- they're not talking to one another- and the lady in Revenue I was talking to- openly admitted she had never heard of an RPZ- and sure, why would it have anything to do with improving a property.............

No wonder- after putting me on hold for 2 minutes- she said she stood over what she had told me, but she trusted that I understood she couldn't put it in writing.................

They're either not talking to one another- or quite simply- are out to undermine one another- however, its safer to ascribe their actions to stupidity rather than maliciousness.

There's no way I'd put a vent installation in as anything other than a "repair" to "fix a mould issue". It may be technically incorrect but I wouldn't care. I actually was required to do this 5 years ago after an inspection and it went into my tax return as a repair.

Kanke

It's been 6 months now and I still can't find a house or apartment that accepts hap.

Please if there is any landlord here that doesn't mind accepting hap for a 2 bed room please I have the required deposit ready. It's for myself and my 7months old daughter