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Rental Property Question

February 27, 2012

I bought a house in 2005 and lived in it from then onwards and have a mortgage with a local bank. Unfortunately I had to move oversees for work and left in December 2010. I have since rented the house out to a family in receipt of Social Welfare and they moved in January 2011. I am pretty sure I will have to file a tax return but how do I go about this and is there anything else I should be aware of?
• From January 2011 you became what is known as a ‘Non-Resident Landlord’ (NRL) and you are correct that you are required as such to file a tax return with the Revenue Commissioners and your first is due by the 31st October 2012 and every 31st October thereafter. There is an extra period available usually to mid-November if you wish to file electronically.
• As a NRL your tenant is required under tax legislation to withhold 20% of the rent and return this directly to the Revenue, however this is an area that the authorities are not overly stringent on provided the landlord returns the income details in their tax return.
• A Qualified Accountant will prepare Rental Income Accounts on your behalf from the information you provide. This will include the total rent received less any related expenditure including property insurance, general repairs, maintenance and upkeep of the property, collection fees, advertising, professional fees a proportion of the mortgage interest, and any others wholly, exclusively and necessarily in respect of letting the property. Note also that you must retain all invoices, receipts, payments records and bank statements.
• You should ensure that you are not receiving Tax Relief at Source or TRS in relation to the mortgage interest. This is only applicable to residents of their own mortgaged home and subject to a number of other conditions. As this is now a rental property TRS cannot apply. Your latest mortgage statement clearly states whether you are in receipt of this and if so you should contact Revenue’s TRS department and cancel it immediately. They simply need your PPS number and mortgage account number to do this.
• Capital allowances are available on all furniture; domestic equipment etc that you have provided to the tenants and you should prepare a list of these and their costs and again retain all invoices and receipts as proof of purchase.
• As a non resident you are no longer entitled to tax credits, however liability is dependant on the profit which is usually relatively low especially where there is qualifying mortgage interest relief. Your accountant will inform you of all costs before and get your approval before submitting the return.
Aside from the taxation implications there are a few other areas which will need attention:
• As a landlord you are required to register with the Private Residency Tenancy Board (PRTB). Failure to do so will mean that the mortgage interest will not be deductible against the income resulting in a higher profit and thus greater liability. The application may be back dated although there is a penalty for late registration and the forms and more information may be downloaded at
• You are also required to register the property for the Non Principal Private Residence (NPPR) charge. As the property is no longer your ‘home’ it is liable for this charge which amounts to €200 per annum. You were first liable 31st March 2011 and payment due by 30th June. Unfortunately as the application is late there is a further €20 per month penalty for late payments. More information and online application and payment facility is available at and if you haven’t yet registered you should immediately do so. ( provides useful information in relation to this)
• You may have the property insured through your mortgage lender or with an independent broker. Either way you should contact your insurer and inform them that the property is now rented as the current policy may not have adequate cover.
• The Household Charge is €100 per residential property situated in the State. The household charge is payable by the owner of the building in respect of each unit of residential accommodation. Where a building is divided into a number of flats or bedsits, the charge applies to each flat or bedsit. An online system – – is in place to enable home owners to pay the household charge by credit card/debit card. In addition, home owners can make the payment by cheque, postal order, etc. Owners of residential property on the liability date of 1st January 2012, subject to a limited number of exemptions and waivers set out below, are liable to pay the household charge by 31st March 2012. The charge can also be paid in four instalments of €25 by Direct Debit on 13th March, 14th May, 13th July and 10th September if you so wish.
Contact Paul or Shauna 074 9321222 for more information in relation to this or indeed any other matters financial or email or simply log on to our website


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