Rent a room

eduds

Hi. Im from Cork and we have a house/property in Cork. My wife works near our place and our son attends a school near our house as well.

Recently, I got offered for a job in Limerick, which is about 3hrs drive back and forth from our place in Cork. We’re thinking of buying an apartment near my workplace in Limerick to avoid the 3hr drive daily, and we will maintain our house in Cork for my wife and son. I’m thinking of renting out 1 room if be buy this apartment in Limerick to help us with the mortgage/expenses. I’ll be staying in this apartment in Limerick 4-5days per week. My question is, will this qualify under the rent a room scheme if I rent out 1 room of this apartment in Limerick? I’m curious if somebody has done something like this (getting a 2nd property/mortgage near workplace while maintaining the 1st house/mortgage). Thank you.

DubCount

AFAIK the rent a room scheme only applies to your principle private residence(PPR). As your spouse and children live in Cork, thats going to be your PPR. I'm sure you may get some posts about making the property in Limerick your PPR, but I dont think that will work as you only get one PPR per married couple and there is going to be no objective way of changing the reality.

dory

As above, you can only have one PPR and can rent a room in whichever house that is. A lot of unmarried couples unofficially live together so they can rent out a room in one of their houses. But that gravy train ends once they get married.

SharkMX

Ive seen plenty of people separate for convenience in he past. Its not unusual for people to take a break. Though i have seen it lots for social welfare, never seen it for rent a room though.

Mrs OBumble

If they OP is going to be in Limerick 4-5 nights a week, he IS separating from his wife. No longer eligible for joint assessment, but can have a separate PPR.

DubCount

https://www.boards.ie/discussion/comment/121992549#Comment_121992549

Sorry MrsOB. I generally agree with most of your comments, but I'm not sure this is the case. The establishment of PPR has been though the courts a good bit over the years, and as far as I am aware a married couple (unless divorced or legally separated), can only have 1 PPR. This has been through the courts a good bit and was particularly popular around the NPPR charges when people with holiday homes tried to state their main residence was the PPR for one spouse and the holiday home was the PPR for the other.

I reckon OP should contact Revenue or an accountant for an opinion on this one.

eduds

Thanks for the comments, appreciated. I tried contacting the revenue regarding this and I’m still waiting for their response.

DFB-D

https://www.boards.ie/discussion/comment/121992916#Comment_121992916

PPR is not related to rent a room.

Rent a room is based on the sole/main residence, so it can apply if the OP spends enough time there to qualify. The amount of time is not set by Revenue guidance, so err on the side of caution.

But yes, good advice to involve a tax advisor or accountant.

Claw Hammer

https://www.boards.ie/discussion/comment/121993356#Comment_121993356

The O/P's problem is if the apartment is the sole residence, his house where his wife lives will not be his main residence.

If he pays enough in mortgage interest he may not have a profit on the rent from his lodger anyway so it will be irrelevant whether or not it is his main residence or whether he qualifies for the rent a room scheme.

DFB-D

https://www.boards.ie/discussion/comment/121993398#Comment_121993398

But why would he need his family home to be considered his main residence?

Claw Hammer

https://www.boards.ie/discussion/comment/121994664#Comment_121994664

There will be CGT implications if he sells it and he may be claiming mortgage interest relief on it.

DFB-D

https://www.boards.ie/discussion/comment/122000434#Comment_122000434

I already mentioned that the criteria for PPR relief and rent a room relief differ....

Where 2 properties are owned as residences, the OP will nominate one as their PPR and this need not be the property where he spends his working week.

Rent a room relief will just apply where the op spends most of his time, i.e. The 2nd property and in my experience, Revenue have accepted some genuine cases where one spouse is working away from the family home.

There is no interaction between the two reliefs beyond that RAR will not impact PPR relief (it would have in the past).