Register with PRTB: any exemption for non investors who cant sell their house?

[Moggy]

Re: Should I register? (..with the PRTB)

Moggy, I dont understatd why you are asking me to read my own post (its simply a quote from the prtb website).

ajapale please I'm just here for some sound advice. This is a serious situation I'm in so if you've no advice to give I'd appreciate if you'd stay out of the discussion.

I'm not sure what "leeway" you are concluding is available re the prtb - you have one month to register.

By leeway I mean we will not have to pay CGT if we sell within a year or so (based on the calculation given) and also if I were not to register and get caught we will have 2 weeks to sort it out and will not face an automatic €3,000 fine and/or 6 months in prison as is suggested here.

it seems that you think that you can wait til the prtb find you and then register within 14 days

Yes this is what I think. I also think all these measures by the PRTB are designed to catach property investors who are evading tax. I don't beleive they are designed to catch out a newly married couple who are forced to rent as an alternative to handing the keys over to the bank. I think once the letter comes and we explain the situation in writing we will just have to register within 2 weeks (and pay back the TRS and everything that comes with registering) and that will be that.

Have you considered that if you do decide to rent out the apartment that you may have stamp duty clawback to pay as well? As the apartment was once your PPR and now is treated as an investment. I believe the rule is based on if you purchased the apartment within the last 5 years.

Yes I'm aware of the stamp duty situation. Renting aside, the fact we are selling before the 5 year time frame is up means we must pay the stamp duty.

 

[sam h]

Re: Should I register? (..with the PRTB)

Moggy, you are missing a key element. Say you get €12k in rent in the year and pay €10k in interest but you haven't registered. It is not simply a matter of paying the €140 late fee and all is fine. You will then be liable for tax on the full €12k rather than on €2k. That could cost you about €5k in income tax. There have been other posters on AAM who have been caught with this & the Mr Taxman does not really care that you are abit strapped for cash. All he sees it you have made an income, you are liable for tax.

 

[Moggy]

Re: Should I register? (..with the PRTB)

You will then be liable for tax on the full €12k rather than on €2k.

OK well thats definitely something to consider.

 

[ajapale]

Re: Should I register? (..with the PRTB)

ajapale please I'm just here for some sound advice. This is a serious situation I'm in so if you've no advice to give I'd appreciate if you'd stay out of the discussion.

Moggy,

Im sorry that you did not find my contributions either sound or helpfull. Are you confusing me with some other poster/moderator?

Ive changed the title to reflect your question more accurately. Let me know if this is ok.

Finally, if I were in your situation I would be seeking independant advice from the appropriate professionals (accountant/tax advisor/solicitor etc)

aj
(moderator)

 

[Trustmeh]

Re: Should I register? (..with the PRTB)

Yes I'm aware of the stamp duty situation. Renting aside, the fact we are selling before the 5 year time frame is up means we must pay the stamp duty.

I dont think you are understanding me. You dont owe stamp duty on any house that you sell - only on houses you buy. You paid stamp on your ppr apartment when you bought it originally. The stamp duty rate you would have paid was probably non-investor ie; possibly zero. But if you rent out before the 5 years you will owe the difference between what you paid and the investor duty that would have been charged at the
time. Use the search function on this site, its easy.

http://www.askaboutmoney.com/showthread.php?t=42159

I really think you need to go into a tax adviser quick because you seem unable to take on board the advice here and/or understand it fully.

 

[z106]

Re: Should I register?

I already said we lowered it as much as we could. This is not a question of greed, its a combination of the downturn and other factors I'm not going to get in to. We're not giving the apartment away, we might as well just hand the keys over to the bank and save ourselves the hassle.

From what i can gather,what you are actually saying is that due to your current financial situation you can't really afford to sell the property for less than what you are currently asking for it.

As a result of this sticky financial situation you find yourself in,you are hoping the tax man will make allowances for you.

Well that is a long shot.

Like - it's hardly the tax mans fault that your finances aren't in order?

You can hardly expect the tax man to go around to everyone to find out if they can currently afford their tax bill - and then simply leave them off paying the bill if they find they cannot pay it because they have spent that money on other stuff.

Or is my understanding incorrect?
Apologies if it is - but that seems to be the crux of it going by what I've read.

 

[Persius]

Re: Should I register? (..with the PRTB)

...Yes I'm aware of the stamp duty situation. Renting aside, the fact we are selling before the 5 year time frame is up means we must pay the stamp duty.

Incorrect. If you keep the property for less than 5 years but it is your PPR for the entire time, and never rent it out, there will be no stamp duty clawback.

 

[Trustmeh]

Re: Should I register? (..with the PRTB)

Incorrect. If you keep the property for less than 5 years but it is your PPR for the entire time, and never rent it out, there will be no stamp duty clawback.

I think muggy thinks the stamp duty he has paid on his new house is what we are talking about. wait untill he figures out he could get caught for having to pay stamp duty twice in this situation! once for buying new ppr and once for clawback on renting out the apartment.

 

[Moggy]

Use the search function on this site, its easy.

I'm aware of the stamp duty situation and am not seeking advice on it right now, but thanks all the same. I'll use the search function to find out more info on it, but right now I'm looking into the PRTB.

As a result of this sticky financial situation you find yourself in,you are hoping the tax man will make allowances for you.

LOL. As a self employed professional I am fully aware of how the tax man operates and I'm not expecting any special allowances. I'm expecting some leeway (clearly the wrong choice of words as some people are getting rubbed up the wrong way about it, but I'll stick to it at this stage) and based on some peoples advice there is leeway regarding CGT. All things going to plan we won't have to pay any, whether we're registed or unregistered.

CGT was my main concern. I was under the impression once we are registered as landlords we would be fleeced by CGT when selling and as far as I was concerned it meant sticking to the landlord business long term, something I have no desire to do nor the knowlege/skills to do it effectively. As this is not true I should have nothing to worry about.

At this stage I think you are right I need to talk to a professional. I always like to have a certain amount of knowledge so that I can better understand the advice and be able to ask questions. As you can all tell I'm clueless, hence me asking here before hand.

I have taken on board everyones advice (those with advice), sorry if I've given the impression that I am not taking your points on board. I'm just trying to bash this out and understand it.

 

[Moggy]

Re: Should I register? (..with the PRTB)

Incorrect. If you keep the property for less than 5 years but it is your PPR for the entire time, and never rent it out, there will be no stamp duty clawback.

I am already aware of this.

I think muggy thinks the stamp duty he has paid on his new house is what we are talking about.

I am already aware of the stamp duty situation. Will I say it again? I am already aware of the stamp duty situation. One more time? I am already aware of the stamp duty situation.

wait untill he figures out he could get caught for having to pay stamp duty twice in this situation! once for buying new ppr and once for clawback on renting out the apartment.

Only if I register

Thanks for all the advice. Over and out.

 

[Trustmeh]

Re: Should I register? (..with the PRTB)

Only if I register

Thanks for all the advice. Over and out.

Yes, best if you did move on. If you think that you're only risk to being caught for avoiding stamp duty clawback or any other tax is wether you register with prtb or not - then good luck too you. and by that i mean bad luck. and i do hope revenue go looking for people with this attitude. isnt that what they got those big new fancy supercomputers for? they have to earn their keep after all.

(this is a good thread spin off - if/when revenue does crack down - it should help to get things moving in the housing market. im sure many people are avoiding lowering their asking prices by renting out houses "illegally" and avoiding prtb/clawback/trs/rental income tax/etc... anyone out there want to run a simple program that cross checks propertypin's houses for sale listings with dafts houses for rent? it should net a good percentage of tax dodgers)

 

[sam h]

CGT was my main concern. I was under the impression once we are registered as landlords we would be fleeced by CGT when selling

The CGT will only kick in from when your OH stopped using it as her PPR (AFAIK). You should have got a formal valuation, should still be able to if not too long ago. As property prices have come down in the last while, you may actually have a CGT Loss which you can carry orward to use against future Cap Gains.

 

[webtax]

Re: Should I register? (..with the PRTB)

Moggy, if you are trying to evade CGT or income tax on rental income, you will not get any assistance in this regard on AAM.

Sorry I gave that impression I've removed my comment above about CGT. I'm not trying to evade anything, I'm just asking do I need to register or is there an exemption for non investors who cannot sell their home and are forced to rent.

Only if I register

looks like you were trying to evade after all. in case you're tempted you should remember:
1) your tenants have 4 years to claim rent relief
2) prtb and revenue have started sharing their records
3) the revenue will have you & your wife on record as having two properties. do you not think they'll wonder what you're doing with the non-PPR and how you're funding the mortgage?

 

[Butter]

As people tend to find out when they have the idea of renting out a property there is actually a hell of a lot of information that they need to get to figure out if it worthwhile or not.
It's not anybody's fault when they point out the legal and tax obligations associted with being a landlord even if the information is not what the OP wanted to hear.
If the OP has already got an accountant to deal with their books as he is self-employed, maybe the accountant is the person to talk to about all of this. It's not just as simple as hoping you don't get caught and if you do then paying up after you get caught. The taxman is fond of interest and penalties and that can substantially increase the costs.
If it was me I would sell the property even if I could only get a break-even price, then there's no worries about paying back stamp duty or CGT.
If I couldn't do that I'd change the mortgage to interest only, register the property with the PTRB and declare the rent on the self-assessment. From experience though, even when a property has a low ltv it's still hard to actually make a profit from renting it out and there are a lot of hassles associated with being a landlord especially if it is not something you actually want to do.
In the future I can well see a huge campaign by the revenue to get all the money owed by undeclared landlords (both stamp duty clawback and unpaid tax).

 

[Moggy]

As people tend to find out when they have the idea of renting out a property there is actually a hell of a lot of information that they need to get to figure out if it worthwhile or not.

Thank you, at last someone who understands what I am trying to do here.

 

[KBR]

Moggy,

At this stage you might as well go and check out how much tax you would have to pay - it's really not that much & by the sounds of your post you would have a very large interest write off. Registering also is only €70 per tenancy & is tax deductable. You're probably bringing in about €12k income a year & the tax is bound to be less than €1k on this if you avail of all the write-offs available.

 

[ajapale]

Re: Should I register? (..with the PRTB)

It is a requirement on all landlords to register details of their tenancies within one month of their commencement.

It appears you have one month from the commencement of the tenancy. How long have your tenants been in place?

 

[Brendan Burgess]

This thread has become repetitive. I have deleted most of the posts which added nothing.

Brendan
Administrator.