Rent a Room Relief - devil in the detail

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WizardDr

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Revenue have issued a useful Manual on Rent-a-Room Relief.

From reading the document it appears to me that you have to submit a tax return with the exempt income included even if your sole income is PAYE.


The offending paragraphs are:
"Although the relief applies automatically, the rent-a-room scheme does not remove the obligation to make a tax return. An individual who is required to submit anannual return of income must enter the amount of exempt rental income on the return (in the ‘Exempt Income’ section of the form). The usual return of income forself-assessed taxpayers is the Form 11.

Taxpayers whose only other source of income is employment income taxed under PAYE can file a Form 12 return including the exempt income. Returns of income must be submitted by the return filing date for the year of assessment in question. An extension to this deadline may apply where the Revenue online facility (ROS) isused to pay and file."

The first paragraph is what I assume is the 'chargeable person' where Revenue require an income tax return ( a small portion of mainly tortured self employed) but the second paragraph is slightly uncertain with 'can' instead of 'must'. [ It had always been my understanding that you had to formally claim the relief by disclosing the exempt income.]

 
Hasn't it always been the case that the rent a room tax free income has to be declared on the individual's firm 11 or 12 return? I'm not really sure what your point is here about the devil being in the detail?

Rent a room tax relief scheme

Rent-a-room relief makes it possible to earn tax-free rental income when you rent out a room in your home to private tenants.
www.citizensinformation.ie www.citizensinformation.ie
If you qualify for rent-a-room relief, the income you get from renting out the room will be exempt from PRSI, the Universal Social Charge or income tax. However, it must be included on your annual income tax return.
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Well the point is that many people do not declare and that raises non filing of a tax return. If you read the document you would see the other issues.
 
"even if your sole income is PAYE." if you are in receipt of Rent a room income, that is still counted as an income. Similarly with the Childcare Services Relief. I would imagine though that a lot of people don't file this income at all, even if exempt from tax.
 
misemoi said:
"even if your sole income is PAYE." if you are in receipt of Rent a room income, that is still counted as an income. Similarly with the Childcare Services Relief. I would imagine though that a lot of people don't file this income at all, even if exempt from tax.
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I would think there are lots of people renting out a room in their house earning a few grand who are ignorant of the fact that they are required to state rent a room income in their tax return. They would just have latched onto the fact that's its tax free and wouldn't just be aware.
 
Roro999 said:
I would think there are lots of people renting out a room in their house earning a few grand who are ignorant of the fact that they are required to state rent a room income in their tax return. They would just have latched onto the fact that's its tax free and wouldn't just be aware.
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Maybe, but these people are still knowledgeable of the Rent-a-Room Scheme and in most cases, the ceiling on income to qualify for relief. These days it's easy to find out things relating to your tax affairs than ever before.
 
Luternau said:
Maybe, but these people are still knowledgeable of the Rent-a-Room Scheme and in most cases, the ceiling on income to qualify for relief. These days it's easy to find out things relating to your tax affairs than ever before.
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Yes. Also there is confusion re RTB registration. My understanding is that registration is not required but a call to RTB will give you different answers depending on who you speak to. Its a great scheme though. I dont understand why older people dont do it to supplement income and use space.
 
ThisisMax said:
Yes. Also there is confusion re RTB registration. My understanding is that registration is not required but a call to RTB will give you different answers depending on who you speak to. Its a great scheme though. I dont understand why older people dont do it to supplement income and use space.
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I would say many older people would be very wary of having someone (a stranger) living in their home.
 
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What does this mean?

"rent-a-room relief does not apply to payments received either directly or indirectly by an individual, or a person connected with the individual, for accommodation provided in the family home where that individual is an office holder or employee of the person making the payment or of a person connected with the payer"
 
WizardDr said:
What does this mean?

"rent-a-room relief does not apply to payments received either directly or indirectly by an individual, or a person connected with the individual, for accommodation provided in the family home where that individual is an office holder or employee of the person making the payment or of a person connected with the payer"
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You can't claim it if the paying lodger is employed by you or someone close to you.
 
It
T McGibney said:
Not just older people.

I know of someone who was brutally murdered by a lodger whom they had taken in under the rent-a-room scheme.
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Wont be long I said to myself before someome comes along with a rent a room horror story - and there we go - a murder...:confused:
Mostly murder does not happen and also not all rent a room schemes are in the same house as the landlord - there is provision for an attached dwelling so people would not have to share with a lodger.
 
T McGibney said:
Not just older people.

I know of someone who was brutally murdered by a lodger whom they had taken in under the rent-a-room scheme.
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That's awful. There was a case of a murder re a game of chess bwtween owner and tenant.

Of course, in this day and age, and with outcomes like you outline, it could happen to anyone. I responded just on the base of the ref to older people.
I thought of it a few years ago but you can never tell what you are inviting into what should be your personal/safe space. You cannot put a price on that
 
ThisisMax said:
It

Wont be long I said to myself before someome comes along with a rent a room horror story - and there we go - a murder...:confused:
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Would you prefer we didn't mention it?
ThisisMax said:
Mostly murder does not happen and
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What sort of argument is that? "Mostly all sorts of crimes do not happen."?
ThisisMax said:
also not all rent a room schemes are in the same house as the landlord - there is provision for an attached dwelling so people would not have to share with a lodger.
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The criteria for eligibility for rent a room in such scenarios is in fairness as clear as mud.
 
T McGibney said:
Would you prefer we didn't mention it?

What sort of argument is that? "Mostly all sorts of crimes do not happen."?

The criteria for eligibility for rent a room in such scenarios is in fairness as clear as mud.
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Preferable.
Not an argument. A fact. 1 murder of a home owner which may not have even been through rent a room.
Criteria is clear though no official opt in/ qualification is an issue. If they closed it they would add to homelessness even further as there is no way I'd do a standard rental lease, I'd leave it empty.
 
ThisisMax said:
It

Wont be long I said to myself before someome comes along with a rent a room horror story - and there we go - a murder...:confused:
Mostly murder does not happen and also not all rent a room schemes are in the same house as the landlord - there is provision for an attached dwelling so people would not have to share with a lodger.
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I want to murder my tenant when he cooks.....
It's great money but mother of god it tests your sanity at times!
 
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