New landlord needing advice!

[erso]

Hi,
This is my first time using askaboutmoney, so apologies if I am asking about issues already discussed.
My house has been rented since Jan 2012. This house had been my primary residence from Sept 2006 till Dec 2011. Unfortunately, I am one of many unplanned landlords in this country! I would appreciate some help on tax issues that are causing stress!
1. According to A Revenue Guide to Rental Income, "pre-letting expenses are non-deductable, "i.e. expenses incurred prior to the date on which the premises was first let." Are items I purchased in 2011, just prior to my first letting, deductable? (Mirrors, bathroom/kitchen/living room accessories and furniture, curtains,curtain poles, electrical appliances etc...deductable?
2. Are items I purchased back in 2006 deductable? (Kitchen appliances, other accessories, bedroom furniture)? If so, how do I value them?
3. According to A Revenue Guide to Rental Income, "Expenditure incurred between lettings" are non deductable. Are repairs done between lettings are deductable?
4. Can I claim for items purchased second hand without receipts? (Bedroom furniture)
5. How do iI claim for future purchases? (e.g.furniture/electrical appliances/mirrors etc...?)
6. Am I liable for PRSI and universal social charge? If so how do I calculate this liability? Is based on gross, or net profit? If its based on net profit, is that before or after wear and tear expenses are deducted?
7. Are my tenants able to claim rent relief?

I would love to see an example rent account. Thank you.

 

[GDUFFY]

I have found this site to have some good info. http://www.irishlandlord.com

No affiliation.

 

[TenantRef]

The best thing you can do in this case is call an accountant today and meet up with him. At the end of the year accountants spend a lot of their time dealing with messes that their clients have caused througout the year which costs the client lots of money in fee's (which are deductible). This can easily be avoided by meeting with an accountant at the start of the year and tell him what you are going to do, he can then advise you how to start off on the right path.

 

[erso]

Cant afford it!

 

[norejon]

you dont need an accountant . i have been doing it online for a few years now
go to irishlandlord .com site great threads there with the info u r looking for

 

[delgirl]

There's a very detailed easy to understand guide here.

1. According to A Revenue Guide to Rental Income, "pre-letting expenses are non-deductable, "i.e. expenses incurred prior to the date on which the premises was first let." Are items I purchased in 2011, just prior to my first letting, deductable? (Mirrors, bathroom/kitchen/living room accessories and furniture, curtains,curtain poles, electrical appliances etc...deductable?

These items will form part of your entry inventory. You need to create a detailed inventory of furniture, fixtures and fittings with the approximate value (at the first letting date) of the items listed. The total amount can the be deducted from your rental income at the rate of 12.5% per year over an 8 year period. Should you replace an item, say a suite of furniture in year 3, the remaining value of the suite can be written off in that year and the new suite must be added and accounted for at 12.5% again over 8 years.

2. Are items I purchased back in 2006 deductable? (Kitchen appliances, other accessories, bedroom furniture)? If so, how do I value them?

Same as above, check what you paid for them in 2006 and deduct 12.5% per year and use the balance as the current value. They may not be worth very much by this stage.

3. According to A Revenue Guide to Rental Income, "Expenditure incurred between lettings" are non deductable. Are repairs done between lettings are deductable?

Expenses incurred in the period between lettings are deductible provided the landlord was not in occupation of the premises during the period and a new lease is granted.

4. Can I claim for items purchased second hand without receipts? (Bedroom furniture).

Yes, just use the amount you paid for them and deduct at 12.5% over 8 years. The value must be realistic.

5. How do iI claim for future purchases? (e.g.furniture/electrical appliances/mirrors etc...?).

Same as above - write off the remaining value of the item you are replacing and put the new item on the inventory and deduct at 12.5% over 8 years.

6. Am I liable for PRSI and universal social charge? If so how do I calculate this liability? Is based on gross, or net profit? If its based on net profit, is that before or after wear and tear expenses are deducted?

PRSI at 4% will now be payable from the tax year 2013 onwards by PAYE employees in receipt of secondary rental and other investment income.

PRSI has always been paid on this income by self-assessment tax payers including most company directors and people whose principal income is rental.

The PRSI will apply to the rental income after expenses and capital allowances but before losses.

USC applies to rental income after expenses and current year capital allowances but before losses (including s23).

7. Are my tenants able to claim rent relief?

No

I would love to see an example rent account.

There's a simple one here.

You can also completely write off / deduct small items such as a new kettle, pots and pans or floor mats, bathroom bins etc. as Kitchen Accessories Year 1, Bathroom Accessories Year 1 and Household Accessories Year 1. This can be used only for small items which have no real resale value.