Do I waive right to FTB relief by renting out for 6 months?

T

Tony

Registered User
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77
Hi,
We are trying to buy our first home at the moment but want to rent it out for about 6 months. If we rent this out do we wave our right to tax relief or do we still get it?

Any other pitfalls that i should be aware of before venturing down the landlord path?

Regards
Tony
 
Re: Tax relief

1. You can not claim tax relief on a property which is let.

2. You will be liable to Stamp Duty on the house at investor rates.

3. When you do occupy the house the maximum tax relief will be on €5040 of the mortgage interest (for a couple, €2520 if it's a single applicant) rather than the €8000 joint/€4000 single that FTB's are eligible for for up to eight years if they remain in their first purchased house.

4. There may be a CGT liability when you sell the property.

5. The maximum mortgage is likely to be 85% of the purchase price.

All in all there is not much in favour of buying to let for first time buyers.....

Sarah

www.rea.ie
 
Re: Tax relief

ok but what if we are living in the house for 6 months while it is being renovated and then decide to rent it out for a while, are we still liable for stamp duty?
 
Re: Tax relief

If you rent out the house in the first five years after purchase, you are deemed to be an investor for stamp duty purposes.

I have edited the title of your question to make it more relevant.
 
You can rent out under the rent a room scheme, earning up to €7k per annum without being liable for tax or loosing your FTB tax relief. However, you do need to be living in the house at the same time! Otherwise, as previously stated, if you rent it out in its entirity within 5 years of purchase, there will be a claw back element to the stamp duty, payable at invester rates rather than owner occupier rates and you loose FTB tax relief! You can sell the property within 5 years however (as an owner occupier) without a claw bank of stamp duty applying!

As such the rent a room scheme would appear to be your only option of buying and making some income at the same time, without effect FTB benefits!
 
Anything of interest [broken link removed] about tax and letting property
 
thanks to all, this is why i continue to visit this great site. not one idiot in sight
 
What happens if you are renting out a room in your house (under the total of 7k per annum) and then you head off travelling for a year?

Your house is still your place of residence in Ireland so you are covered and have no additional liabilities - is that correct?
 


This is discussed at length here.
 
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