The income you pay tax on is not 9360 less allowable deductions but 19200 less allowable deductions so on 14200 (based on your basic information). Your mortgage is not deducted, just the interest.20 year old looking to invest 50K ,buying 1 bed apartment an option , currently earns 25K
can deduct house insurance, any other stuff, but just trying to keep simple,
Is there any new incentives Government have brought out in last budget that I am missing.
Would you think this is good options, Investing 50K in 5 yr fixed might after tax earn 3.5K
Apartment cost 210K
Mortgage 160K Fixed 25 Yrs 3.8%
Proposed Calculation
Monthly in/out Yearly
Rental €1600 *12 = €19200
Mortgage €820 *12 = €9840
Profit €9,360
Allowable Deductions
Man Fees €125 * 12= €1500
Mortgage interest €3,500
Pre Tax Net Profit €3360
Tax,PRSI,USC 30% €1008
Profit €2352
The interest is €6,102.The income you pay tax on is not 9360 less allowable deductions but 19200 less allowable deductions so on 14200 (based on your basic information). Your mortgage is not deducted, just the interest.
You also forgot quite a few costs: maintenance, furnishing, insurance, lot been a few of these.
I agree 100%. Of all the accidental landlords that I speak to, the owners of 1 bed apts are the worst. They just haven't recovered in value the same way as bigger apartments. There is a much lower demand for them as there's no really enough room for 2 people in them, just people who live on their own.Buying a 1-bed unit, at what I'd consider to be the height of the market, and at a time when tax rules don't favour small individual landlords....
Sorry, but I really don't think it's a good idea.
It's terrible for so many reasons that any lender would not entertain it.Would you think this is good options
my mistake, was not thinkingThe income you pay tax on is not 9360 less allowable deductions but 19200 less allowable deductions so on 14200 (based on your basic information). Your mortgage is not deducted, just the interest.
You also forgot quite a few costs: maintenance, furnishing, insurance, lot been a few of these.
Simple as this , She would be telling bank she will be living there as this country does nothing for our youth so we have to do ourselves, she can get upto deposit needed legal fee etc, and I will go guarantor as lucky enough not to have mortgage and have good salary,The interest is €6,102.
As it's a buy to let, you need a 30% deposit and the interest rate will be higher, the cheapest for a 70% LTV is 5.33%. You also give up your first time buyer status.
I agree 100%. Of all the accidental landlords that I speak to, the owners of 1 bed apts are the worst. They just haven't recovered in value the same way as bigger apartments. There is a much lower demand for them as there's no really enough room for 2 people in them, just people who live on their own.
Not getting caught is not the same as being legal. They should not be claiming the rent a room. Lying on a self assessed tax return and getting away with it does not equate to it being "completely legal"do take point of 1 bed so can actually get 2 bed for 225, I was speaking to someone who has a 2 bed and does the room to rent scheme and only stays in the apartment once a month themselves when in Dublin and gets the full rent of around 11k tax free legally.
That's not how it works anymore. If you got a joint mortgage, the term will be limited by your age and therefore monthly payments are likely to increase. As it would be a second property for you, you can't pretend it is for you to live in so it will be BTL rates. But more than likely, the lender will see through the pretence and not offer a mortgageI will go guarantor
Encouraging your daughter to lie on a legal document (loan offer) and then to subsequently lie on a self assessed tax return could lead to a whole lot of problems for her in the future. Using a strawman argument to justify your means does not make any of it legalSimple as this , She would be telling bank she will be living there as this country does nothing for our youth so we have to do ourselves
That is not in any way legal, it's tax evasion.the apartment once a month themselves when in Dublin and gets the full rent of around 11k tax free legally.
It is indeed sad that parents are guiding their children into dishonesty or crime as opposed to bettering their prospects through education and hard work. That said I think you need to take a step back and reconsider the position. A 20 year-old earning €25k with €50k to invest is better off than many of their peers.Sad Ireland we live in that we need to come up with this type of stuff to make a some head way.
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