Foreign Property - Domestic Borrowings

Hi,

I am looking for help on this as I have been given conflicting information. last year I purchased an apartment in Luxembourg. I borrowed the money with AIB. As it stands, my rental income is €850 p.m., and my repayment is €750p.m. Revenue have told me that I don't need to make a return in Luxembourg, merely deal with it as if it were an Irish property and make my returns here. I'm not convinced by this. Could somebody set me straight please??

Luxembourg has a lowish tax regime, so for example a married couple earning less than €32,000 may not have to pay any tax (depends on number of children/other variables). Assuming that this is your only rental property there, then you earn €10,200 per year. I'm not sure about this, but the revenue may be referring to the fact that you will file a return of €0 in Luxembourg and then proceed to pay tax on the income in Ireland as normal. It's quite a complicated tax system though, so it's probably best if you speak to a local accountant.

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Thanks for that budapest. That makes sense alright. I am a PAYE worker here. If I am making a return for this, do I need to register as self-employed for the purposes of this property, or is there a way of declaring the tax due simply (eg via form 12)?

Anything [broken link removed], for general info on rental income and "How are foreign rents taxed?" in relation to your query