noobie99 said:
Clubman - can you link to the info about that 12 month 'grace' period?
See section 5 of this Revenue booklet. As far as I know the fact that the property may be rented out during this period has no impact on the CGT situation but could trigger a stamp duty clawback if done in the first five years of ownership.
Also, How does one inform Revenue as the what property is ones PPR?
Just write to them I suppose? They will probably know by default if you switch the claim for owner occupier mortgage interest relief from one mortgage/property to another.
If one move and rents out ones PPR is one obliged to inform the mortage lender as well as revenue?
Depends on the terms & conditions of the specific mortgage agreement. In most cases alternative insurance cover will be required as a standard owner occupier policy will not cover a rental property.
Is stamp duty clawback allowable expense in any form when 'converting' PPR to investment property?
As far as I know you can offset when calculating any
CGT liability at disposal but not against rental income or anything like that. I would be wrong though.
If the difference between the price of buying the house to what it is worth now is signficant e.g. 100k. then would it be possible to 'move back into the house' i.e. not rent it, and have it as a 'base' with all the bills etc in one's name.
I don't understand this. An individual or married couple can only have a single
PPR and this is the property in which they normally reside. I don't unnerstand the "having a base" issue. A property is either one's
PPR or it's not. Also - if the stamp duty clawback applies then there is no loophole to escape it. It is a self assessment tax and must be declared and paid once a property bought as an owner occupied
PPR is rented out within five years of purchase. If
CGT is an issue due to the property being a
PPR, then rented and then a
PPR again then the periods of rental and
PPR occupancy are simply factored into the equation that I mentioned above when calculating what portion of any resale gain is subject to
CGT.
In this case does it become a PPR?
It becomes a
PPR again but if the property was rented out for more than 12 months then
CGT on some portion of the gain will still be an issue.
And if you sell it after a few months, how does the government know? Is it up to the individual who owns just the one property to declare that it is not their PPR? Or does the govt cross-check against tax returns (I'd be impressed if they were that organised)
Some of these issues involve self assessment and declaration. There is no formal process for declaring a property one's
PPR or an investment property as far as I know but, as ever, the onus is on the individual to keep his/her tax affairs up to date or face the consequences (immediately or in the future).
For more comprehensive assistance with these queries you should consider seeking independent, professional tax advice.