Rental income from Irish rental property is taxable in Ireland, irrespective of where the property owner resides. It may also be taxable in the taxpayer’s country of residence.
Services Provided
Benefits of Working With Us
- Rental Income Reporting: Assistance with accurately reporting rental income from Irish properties.
- LPT Compliance and Registration: Guidance on the requirements, registration and deadlines for paying Local Property Tax on Irish properties.
- Non-Resident Landlord Scheme: Advice on the scheme, where rental income is subject to tax deduction at source unless specific conditions are met.
- Double Tax Treaties: Review of applicable double tax treaties between Ireland and their home country.
- Remittance Basis: Advice on the remittance basis of taxation for non-domiciled individuals.
- Foreign Income Reporting: Assistance with reporting foreign income and understanding the tax implications.
- Rental Expense Deductions and Tax Reliefs: Identification and documentation of allowable deductions such as mortgage interest, repairs, and maintenance.Assistance with claiming capital allowances on property-related expenditures.
- Personalized Tax Planning: Ongoing personalized tax planning and advice.
- Understanding Residency Rules: Assistance in determining tax residency status under Irish law.
- Registration with Revenue: Assistance with registering with the Irish Revenue Commissioners.
- Filing Tax Returns: Preparation and filing of Irish income tax returns.
- Record Keeping: Assistance with setting up proper accounting and bookkeeping systems to ensure accurate financial records for rental income and expenses.
- Estate Planning: Assistance with estate planning to minimize tax liabilities.
- Tax Updates: Regular updates on changes to Irish tax laws that might affect their situation.
- PAYE System: Guidance on the Pay-As-You-Earn (PAYE) system for salaried income.
- Personalized Tax Planning: Ongoing personalized tax planning and advice.
- Representation with Tax Authorities: Assistance with any queries or disputes with the Irish Revenue Commissioners.
- Cross-Border Tax Issues: Assistance with managing tax obligations if they have income from rental properties in other countries.
- Expertise in Expat Taxes: Specialised knowledge in handling tax issues for expats.
- Personalised Advice: Tailored tax strategies to optimise your financial situation.
- Comprehensive Support: From filing returns to planning future tax obligations.
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How It Works
Common Challenges Addressed
- Initial Consultation: Discuss your specific needs and circumstances.
- Assessment: Evaluate your tax status and obligations.
- Strategy Development: Create a tailored tax plan.
- Implementation: Assist with filing and compliance.
- Ongoing Support: Provide continuous advice and updates on tax laws.
- Understanding and Complying with Tax Obligations
- Managing Property from Abroad
- Unsure re whether Irish registrations are required
- Estate and Inheritance Planning
Frequently Asked Questions
What taxes am I liable for as a non-resident Irish landlord?
As a non-resident Irish landlord, you are liable for the following taxes:
Income Tax:
Rates: Progressive tax rates of 20% and 40% depending on your income.
Thresholds: The first €42,000 is taxed at 20%, and income above that is taxed at 40% (rates and thresholds may vary yearly).
Income Tax: You must pay income tax on the net rental income earned from your Irish property. The rates are the same as for residents: 20% on the first €420,000 and 40% on income above €420,000.
Universal Social Charge (USC): USC is also applicable on rental income. The rates are 0.5%, 2%, 4.5%, and 8%, depending on the amount of income.
Pay Related Social Insurance (PRSI): Non-resident landlords are typically exempt from PRSI on rental income unless they have other income in Ireland that brings them into the PRSI system.
Local Property Tax (LPT): LPT is an annual tax based on the market value of residential properties in Ireland.
What rental expenses can I deduct from my taxable rental income?
You can deduct certain expenses from your taxable rental income, including:
Mortgage Interest: Interest on loans used to purchase or improve the rental property.
Repairs and Maintenance: Costs of necessary repairs and maintenance (not improvements).
Property Management Fees: Fees paid to property management companies.
Utilities and Services: Costs for utilities and services paid by the landlord.
Insurance: Premiums for landlord insurance policies.
Advertising: Costs of advertising for tenants.
Accountancy Fees: Fees paid for preparing rental accounts.
Legal Fees: Costs of legal services for drafting leases or dealing with tenant disputes.
How do I report my rental income?
To report your rental income:
Register with Revenue: If you haven’t already, register with the Irish Revenue Commissioners as a non-resident landlord.
Annual Tax Return: File an annual tax return (Form 11) to report your rental income, expenses, and calculate the tax due. This should be done by October 31st of the following year (or mid-November if using ROS).
What legal requirements must I meet to operate my rental in Ireland?
To operate your rental in Ireland, you must:
Register Tenancy: Register your tenancy with the Residential Tenancies Board (RTB) within one month of the tenancy commencing.
Meet Safety Standards: Ensure the property meets the required safety standards, including fire safety and electrical safety.
Landlord Responsibilities: Comply with landlord responsibilities under the Residential Tenancies Act, including maintenance, rent reviews, and returning deposits.
Tax Compliance: Ensure you are compliant with Irish tax laws and file annual returns.
How does the Non-Resident Landlord Scheme work?
Under the Non-Resident Landlord Scheme:
Deduction at Source: If your tenant or an agent collects the rent, they are required to deduct standard rate income tax (currently 20%) from the rent paid to you.
Filing Returns: You are still required to file an annual tax return to report the full rental income and claim a credit for the tax deducted at source.
Collection Agent: If you appoint a collection agent, the agent can collect the rent without deducting tax, but you must file annual returns and pay any tax due.
How is the Local Property Tax (LPT) calculated?
The LPT is calculated based on the market value of your property. Here’s how it works:
Valuation Bands: Properties are grouped into valuation bands. The tax rate is applied to the mid-point of the band your property falls into.
Rates: LPT is charged according to the valuation band that applies to a property. Each band has a corresponding basic rate of LPT for the valuation period 2022 to 2025.
Self-Assessment: You self-assess the value of your property and calculate the LPT based on this value.
How do I claim double taxation relief?
To claim double taxation relief:
Double Taxation Agreements (DTAs): Check if Ireland has a DTA with your country of residence. These agreements often allow for a tax credit or exemption to avoid double taxation on the same income.
Claiming Relief: When filing your tax return in Ireland, declare the foreign tax paid and claim the credit for the same. You may need to provide proof of tax paid abroad.
Professional Advice: Consulting a tax professional can help you navigate the specifics of DTAs and ensure you maximize your relief.
How does rental income impact my overall estate plan?
Rental income can impact your estate plan in several ways:
Estate Value: Increases the overall value of your estate, potentially leading to higher inheritance tax liabilities.
Inheritance Tax (CAT): Beneficiaries may face CAT on rental properties inherited.
Succession Planning: Ensure rental properties are accounted for in your will and consider the tax implications for your heirs.
What strategies can I use to minimize inheritance tax (CAT) on my property?
To minimize CAT on your property:
Thresholds: Understand the tax-free thresholds for beneficiaries (Group A, B, C) and plan accordingly.
Agricultural and Business Relief: If the property qualifies, these reliefs can reduce the taxable value.
Section 72 Policies: Life insurance policies specifically designed to cover CAT liabilities.
Gifting: Consider gifting properties during your lifetime to take advantage of annual small gift exemptions.
Professional Advice: Engage with a tax advisor or estate planner to structure your estate in the most tax-efficient manner.
