Minister says tax measures may be needed to keep landlords from exiting the rental market,

So called Landlords have been doing what the Goverment should have been doing for many years now. They've been treated like dirt, no wonder they've left the market, and are still leaving in droves. It also needs to be said that a sizeable amount of tenants treat where they stay with total disrespect. Some won't like seeing or hearing that but the truth needs to be told. If a proper letting market existed, everything might be a lot different. Forever hearing about bad landlords, never hear about the disgraceful tenants out there.
 
You need lower tax rates on landlords (small landlords with one or two properties).

You need higher tax rates on institutional landlords and reits.

You need an ability for landlords to get bad tenants out of their property quickly. It's a joke taking two years with no payment etc.

If the government act quickly they can stem the tide and maybe attract new landlords into the sector.
 
Páid said:
Tax measures may need review to keep landlords from exiting the rental market, says minister https://jrnl.ie/5755491


Some would say that maybe it's a little too late?
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From that article, the minister's language is very telling. (My emphasis.)

“A changing regulatory environment, which has been necessary to ensure a fair and effective residential rental sector that balances tenants’ rights and landlords’ responsibilities, has resulted in a challenging compliance framework for some."

Nothing about tenants' responsibilities or landlords' rights! What a flawed concept of balance. :eek:
 
PebbleBeach2020 said:
...

You need higher tax rates on institutional landlords and reits.

....
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I can't see any reason why this is particularly necessary to encourage a rental market. The other three points make sense, this just seems designed to discourage institutional landlords, this might be a personal preference but it will not have a positive impact on availability of rental properties. The problem isn't that there are institutional landlords, the problem is that the current systems are ...discouraging... small scale landlords.
 
Can there really be different income tax rates on different types of income?

OK, the DIRT tax might be different than income tax, but that is one case, and interest income is not significant at the moment.
 
Protocol said:
Can there really be different income tax rates on different types of income?
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It's a fair point.

Carving out rental income from other non-employment income can have unintended consequences and there are lots of questions around the edges. For example would commercial rental income be treated the same, etc.

My own preferred solution is that all occupied rental properties pay LPT @1%. All rental income exempt from income tax, PRSI, and USC. You could have some exemption system for rental properties in renovation or with non-paying tenants but it would simplify the whole system incredibly.
 
NoRegretsCoyote said:
It's a fair point.

Carving out rental income from other non-employment income can have unintended consequences and there are lots of questions around the edges. For example would commercial rental income be treated the same, etc.

My own preferred solution is that all occupied rental properties pay LPT @1%. All rental income exempt from income tax, PRSI, and USC. You could have some exemption system for rental properties in renovation or with non-paying tenants but it would simplify the whole system incredibly.
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Or allow LPT be tax deductible.
 
NoRegretsCoyote said:
It's a fair point.

Carving out rental income from other non-employment income can have unintended consequences and there are lots of questions around the edges. For example would commercial rental income be treated the same, etc.

My own preferred solution is that all occupied rental properties pay LPT @1%. All rental income exempt from income tax, PRSI, and USC. You could have some exemption system for rental properties in renovation or with non-paying tenants but it would simplify the whole system incredibly.
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The application of PRSI/USC on rental income is one area that should be looked at . 12% in our case is a bit saucy and there is no extra benefit to landlords in paying this , it's not as if one gets extra benefits by paying it. Applying the existing tax rates would be more equitable.

But as you have been saying on multiple threads the entire system is skewed towards the tenants and that's the issue for us. Sick and tired of not being able to do what we want when we want with our money/assets.

Our 2 properties are rented by professionals Drs and Senior Accountants and they would be paying a lot more in mortgage payments to live in those properties.

We are charitable people and have no issue with helping those in need, but we now feel that despite a lifetime of hard work and making money paying 6 figure income tax we honestly feel like second class citizens.
 
Paul O Mahoney said:
The application of PRSI/USC on rental income is one area that should be looked at . 12% in our case is a bit saucy and there is no extra benefit to landlords in paying this , it's not as if one gets extra benefits by paying it. Applying the existing tax rates would be more equitable.
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PRSI makes little odds to most landlords who are in employment. But for those who aren't, 4% on rental profits is an amazingdeal for a state pension.

If you're a landlord with other employment you pay 4% PRSI on rental income which gets you nothing additional as you pay PRSI anyway. The landlord of the house next door with no other income aside from rental profits pays 4% and gets a full state pension at 66. That's a real inequality of treatment.

It's another reason to tax rental properties different from trading and labour income.
 
make LPT tax deductible yes. You could have rental income not liable for USC and PRSI (reducing effective tax rate on many 'mom and pop' landlords by 11%. If they want equality of treatment for all landlords then charging one group 51% tax rate and the other larger institutional landlords 12.5% (if even that!) then it's not really fair. Also, I would suggest that new tenancies, which are the ones increasing by 10% a year according to reports, are dominated by larger institutional type landlords, whereas 'mom and pop' landlords are often charging way under market rent as a result of being nice to previous/current tenants and not raising rents due to tenants being general good tenants anyway.

To help current small landlords,the government needs to do in on the taxation side or else helping to speed up the removal of bad tenants and instead of giving landlords nothing but "responsibilities" give them some "rights" would also help.
 
Firefly said:
I wouldn't hold out any help for landlords regarding bad tenants or on the taxation front...SF would just lap it up.
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Yep and the others , I jokingly said to someone a few years ago that I was going to set up a new political party "Profit before People " slogans included " you work for it you keep it" , there was a rude one too, where I spelt poor as "pour" .

Some said youd probably garner 10% first preference votes
 
Firefly said:
I wouldn't hold out any help for landlords regarding bad tenants or on the taxation front...SF would just lap it up.
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what kite do you think the Minister was flying so? I expect that there will be some give to landlords (with 1 or 2 properties only) in terms of LPT being allowable and/or a reduction in the taxation rate. I really do believe that as landlords are selling up, the new landlords (small and institutional) have market rents far in excess of the rents of the properties leaving the sector. The government know this and are trying to appeal or make it appealling to exisiting small time landlords to stay in the game and not sell up. I think it will be coupled with a return of the tax credit for renters so that both sides of the equation get something. Not that this would stop SF moaning and complaining that the government are "looking after" landlords etc.

SF think that they can give/promise renters everything, penalise and punish landlords and that landlords won't act accordingly (i.e. sell up and leave) I believe their rethoric is actually driving landlords out in advance of the next election, thus reducing supply further, making the problem worse and resulting in SF gaining popularity. I don't see how SF proposals about rent freezes, security of tenure for life etc are doing anything but encouraging landlords to sell up asap.
 
For a bit of balance in here:

Why do we "need" Mom and Pop landlords?
If we do, why should they be more favourably treated than Professional landlords? (leave out the outrageous tax shenanigans of REITS etc)

I don't have a fixed view on this.

I've had a This post will be deleted if not edited to remove bad language landlord (taking security deposit for what was wear and tear) and some good ones. We had a rental property for a short while and got snookered with the RPZ having given mates rates previously. Don't and won't have a rental property in future. I agree there needs to be a better balance between tenant and landlord rights and responsibilities.
 
dereko1969 said:
Why do we "need" Mom and Pop landlords?
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Just one thought, mom & pop landlords often bring a different offering, REITs or other commercial scale landlords have little interest in managing the odd house in established estates, or properties outside of the major population areas. They want full developments in new complexes in the large urban centers where scale and consistent demand significantly reduces their costs.

dereko1969 said:
why should they be more favourably treated than Professional landlords? (leave out the outrageous tax shenanigans of REITS etc)
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Is it really a level playin field if small landlords have rental income minus expenses taxed as income with no ability to fund pensions or avail of other tax reduction measures (shenanigan or otherwise :) .)
 
Leo said:
Is it really a level playin field if small landlords have rental income minus expenses taxed as income with no ability to fund pensions or avail of other tax reduction measures (shenanigan or otherwise :) .)
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Agreed. Add to that, being forced to pay Income Tax on non-existent income (income spent on travel, LPT and other non-allowable costs) and USC on income before capital allowances on furniture and fittings.
 
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