Any rumours will they tax landlords less than current full tax rate?
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Well, today's Business Post reports as follows:
Tánaiste Leo Varadkar said that the government would examine “what we can do to reduce the speed at which landlords are leaving the sector” in the coming months. “I know it may not be popular to say so, but the truth is more and more landlords every day are just selling up and have decided that it’s easier to sell their property than to continue to rent it and we just need to reflect on that and see what we can do to improve things,” he said.
Tánaiste Leo Varadkar said that the government would examine “what we can do to reduce the speed at which landlords are leaving the sector” in the coming months. “I know it may not be popular to say so, but the truth is more and more landlords every day are just selling up and have decided that it’s easier to sell their property than to continue to rent it and we just need to reflect on that and see what we can do to improve things,” he said.
Brendan Burgess
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This is what the Tax Strategy Group published today
Read in detail,I would think about not selling if a few of these proposals were introduced in Budget 23.
PebbleBeach2020
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Which is most likely would you think? I think lpt as tax deductible and pre letting expenses are easy token gestures by government but will do nothing to stem the flow of landlords exiting.
I think the 20% tax rate on rental income would be a game changer myself.
I think the 20% tax rate on rental income would be a game changer myself.
20% off your total net rental tax perhaps, those on 20% marginal tax would not benefit otherwise.
That's interesting.
I thought the proposals were pretty modest but I would be interested to know what stood out for you.
Gordon Gekko
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As in “20% goes to 0%” as opposed to “20% goes to 16%”?
The marginal rate going from 52% to 44% (i.e. 20% of 40%) wouldn’t be enough in my view.
A 20% rate would though, maybe even a 30% rate.
1. I pay full rate so end up about 50% so if that was a flat rate of 20% then that is huge savings,
2. CGT Relief EG(4 per cent per annum)=20% relief when selling house for a profit
3.This medium-term measure would allow a tax deduction against rental income for an element of the capital cost of a property in the initial years of ownership of a residential rental unit, with a corresponding reduction in the base cost of the property on a future disposal for Capital Gains Tax (CGT) purposes.
NoRegretsCoyote
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I agree. The TSG paper makes clear that most potential policy changes wouldn't be material to most landlords. LPT deductibility, CGT exemptions, being able to offset rental losses against non-rental income, etc, aren't going to move the needle much.
The TSG paper takes the view that rental profits are income like any other. And that a separate tax regime for rental income would be a major structural change that can't be justified.
I think that there will be changes for landlords in the Budget, but mainly cosmetic.
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PebbleBeach2020
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If so, I think we will be looking at selling up by year end. The government need to make a change via the budget otherwise the exodus will continue and the problem get worse.
NoRegretsCoyote
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Irish Times reports the following pre-Budget discussions today:
I don't think these changes would make a material difference to anyone deciding to enter or exit the landlord business.
Of course they wouldn't, those possible changes are trivial.
If your income can only rise by 2% per annum and your costs are rising by 10% per annum, it doesn't take a genius to work out that is not a viable long-term business.
Tweaking the tax code won't stem the exodus.
While it is dispiriting to see 50% of the profit going in tax that is not the issue for me or I suspect most landlords.
International comparisons show that the cost of renting in Ireland is very high, the cost of buying housing (and so what a landlord selling can expect) is not as excessive.
No landlord, I suspect is getting out because they can't make a profit.
The issue is regulation and the pitfalls of the RTB. In short it takes a long time to evict a non-paying tenant, and there is a fear that there will be restrictions on the freedom to sell.
For once its not all about money.
International comparisons show that the cost of renting in Ireland is very high, the cost of buying housing (and so what a landlord selling can expect) is not as excessive.
No landlord, I suspect is getting out because they can't make a profit.
The issue is regulation and the pitfalls of the RTB. In short it takes a long time to evict a non-paying tenant, and there is a fear that there will be restrictions on the freedom to sell.
For once its not all about money.
150% agreed
And it's also why so few are entering the market..
T McGibney
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Exactly. It's often said about male pattern baldness that it's not your hair falling out that makes you bald, but the fact that new hair growth slows and eventually stops altogether. An apt analogy for this mess.
There's been very good arguments been put forward by many members on this site in relation to how other assets (equities) should be treated from a tax perspective (dividends and potential gains).... Why should rentals be treated any different from equities? As far as I can see no landlord is in it for altruistic reasons! They are in for pure profit with the tenant paying their mortgage while the landlord pockets the gains...
T McGibney
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An apt example of the sort of borderline-aggressive sentiment that continues to motivate landlords to get out of the rental business altogether.
When they start talking of you as if you're a criminal, it's only a matter of time before they come for you and your property.
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