Rental Income Profits
Any individual with rental income profits is a chargeable person for Income Tax purposes. This means that they are obliged to register for tax and make a return each year.
Westland Tax – accountants and tax advisors- provide services and advice in relation to Rental Property Tax Returns including:
• Advice on allowable expenses to offset against rental income
• Completion of Self-Assessment Income Tax Return
The tax due is calculated on your profits after expenses. Typical allowable expenses are:
• interest on a loan taken out for that property
• Management charges
• Insurance
• Repairs & maintenance
• Accountant’s fee
• Any other expenses directly related to the management of the property
• Capital items, such as electrical equipment, furniture etc which are deductible at the rate of 12.5% per annum
Interest Relief
Important points to note are that you must be registered as a landlord with the Residential Tenancies Board to qualify for the interest relief. A loss made on one Irish Rental Property can be set against a profit on another Irish Rental Property owned by you or carried forward against future profits.
Filing dates & Preliminary Tax
As a Rental Property Owner you are subject to the same Self Assessment Regime as the Self Employed and Business Owners. You must to file your Income tax Return by 31st October following the end of the year & pay the tax due together with the correct Preliminary Tax (Tax on Account for the current year.)
Foreign Rental Property
If you rent property abroad and pay tax in that country, you are still obliged to return the rent on your Irish Income Tax Returns. If you have paid tax already the amount paid will usually be credited against the Irish Tax Liability on that foreign property. This will most likely eliminate a large portion of it.
Accountant’s fees
Remember the cost of employing a Tax Advisor to prepare your Rental Income Tax Return is a deductible expense against your rental income. Why not let us quote you for preparing your Income Tax Return.