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Foreign rental tax

  • 21-09-2018 7:52pm
    #1
    speedstar500
    Users Awaiting Email Confirmation Posts: 4 ✭


    Hi,

    I have a taxable income of between 4 to 6k each year from a foreign rental property I have in Sweden which I pay near 50% of when USC and PRSI are added


    Is it possible for me to buy myself a apartment in the sun and use it's losses against my other foreign gains?

    According to revenue.ie it is and it would be nicer to put money towards a nice flat then send it to the government each year?

    Thanks in advance..


Comments

  • #2
    Heisenburg81
    Closed Accounts Posts: 322 ✭✭Heisenburg81


    speedstar500 wrote: »
    Hi,

    I have a taxable income of between 4 to 6k each year from a foreign rental property I have in Sweden which I pay near 50% of when USC and PRSI are added


    Is it possible for me to buy myself a apartment in the sun and use it's losses against my other foreign gains?

    According to revenue.ie it is and it would be nicer to put money towards a nice flat then send it to the government each year?

    Thanks in advance..

    What losses? If you don't make an effort to rent it out you can't incur allowable losses.
    If you do rent it and genuinely make losses these can be offset against profits on your other foreign rents.


  • #3
    wiggle16
    Moderators, Society & Culture Moderators Posts: 3,022 Mod ✭✭✭✭wiggle16


    Where are you seeing that on the revenue website? The section on foreign rents is quite sparse, to my recollection.

    The answer is no, and for two reasons.

    Firstly, you would have to actually rent out the property and make a loss on it. You can't make a "loss" on a property you live in, because it is not a rental property.

    Secondly, even if you did rent it at a loss, you cannot use losses incurred on uneconomic rents against rental income, ie, if you rent out a property in such a way that you cannot turn a profit on it or rent it in such a way that it can only incur a loss, this is not allowable against your other income.

    As an aside, your idea makes no economic sense to me... you'd be spending thousands to buy a property on which you would make a loss if you rented it so you could avoid paying €3000 in tax on a property you already rent profitably. If you owe tax on something, might be nice to just pay it like everyone else.


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