Dependent Relative living rent-free? Need to declare this on tax return?

S

Squonk

Registered User
Messages
791
My mother lives rent-free in a house that I have provided for her. I pay an interest-only mortgage for this house. I get TRS on the mortgage. My question of this : this is my first year doing a tax return, and I am wondering should I just 'ignore' the rental income section on Form 11 altogether (since I have no rental income on this property) and my repair bill is low? That said, am I even 'allowed' to claim expenses such as repairs on this property? Thank you.
 
Squonk I think you are confusing a few things.

If you buy and rent a property (landlord) you pay tax on your rental income and you can deduct the costs (mortgage interest and repairs etc) from the income to arrive at a profit which is then taxed.

TRS is tax relief at source for people living in their own homes (owner occupiers) and they get some small tax relief on the mortgage they are paying directly on their payment via the bank. If you do not reside mostly in the house you have provided your mother than you cannot claim TRS.

I do believe that a house provided for a relative who pays no rent is not a taxable charge for you or your mother (getting free accommodation) and there are rules on this and what is or is not allowed to be claimed but you cannot claim for repairs like a normal landlord. I think you have to pay the NPPR though on this property, there is some rule about it being within a certain distance of your own home.

If you don't reside in the house than you shouldn't claim TRS and you need to clear it up with revenue.
 
Thanks for the replies. I was a bit confused about the TRS so I checked with revenue and I found the link below, so I think I am OK with the TRS claim. I take your point regarding not being able to claim for repair etc.

"You can also claim mortgage tax relief in respect of a mortgage paid by you for your separated/divorced spouse, and a dependent relative (i.e. widowed parent, elderly relative) for whom you are claiming a dependent relative tax credit". http://www.revenue.ie/en/tax/it/leaflets/tax-relief-source-mortgage-interest-relief.html#section1
 
Squonk said:
Thanks for the replies. I was a bit confused about the TRS so I checked with revenue and I found the link below, so I think I am OK with the TRS claim. I take your point regarding not being able to claim for repair etc.

"You can also claim mortgage tax relief in respect of a mortgage paid by you for your separated/divorced spouse, and a dependent relative (i.e. widowed parent, elderly relative) for whom you are claiming a dependent relative tax credit". http://www.revenue.ie/en/tax/it/leaflets/tax-relief-source-mortgage-interest-relief.html#section1
Click to expand...

I can't find the bit you refer to in that long document, can you cut and paste it, I do notice the document keeps referring to main residence.
 
2. What is a Qualifying Loan for TRS?

A qualifying loan for the purpose of mortgage TRS is a secured loan, used to purchase, repair, develop or improve your sole or main residence, situated in the State. With effect from 1st May 2009 the number of tax years in respect of which mortgage interest relief may be claimed is 7 years for first time and non first time buyers. You can claim mortgage tax relief in respect of the interest charged/paid on your main residence. You can also claim mortgage tax relief in respect of a mortgage paid by you for your separated/divorced spouse, and a dependent relative (i.e. widowed parent, elderly relative) for whom you are claiming a dependent relative tax credit. However, your mortgage TRS entitlement cannot exceed the maximum TRS allowance.
 
You must log in or register to reply here.
Back
Top