how to rent my house while travelling

F

Fiona Fox

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My husband and I want to travel and work abroad for six months to a year, depending on the rental situation and what we can afford. We only bought our house in June 2006, but it was less than the stamp duty limit of 317,000. We are first time buyers. Would we still be subject to stamp duty clawback? We don't want to work for the whole of the trip, what are the implications of how long we spend working? The work will probably be voluntary, does this change things? We were also considering continuing to rent it out for a while whan we return so we can study etc. Just exploring options at the moment really. Any other relevant tax or legal info regarding renting while abroad would also be greatly appreciated. We are just starting out and know nothing.
Thanks, Fiona
 
You would definately be liable for the stamp duty clawback (~15K). This is liable from the day that you start renting the place. When you eventually sell you will be liable for CGT for the proportion of time that the property is deemed to be an investment property.

None of the circumstances that you describe would change this.
 
The crux of this question relates to the importance from your perspective of ensuring that your home remains designated as your principal private residence while you are away. If this designation is lost, you stand to lose financially through stamp duty & other costs. You should make it your business to ensure that this designation is maintained at all costs, possibly even perhaps by choosing not to rent your property at all, possibly by tailoring your travel plans to suit, or otherwise. This is a complicated issue with drastic financial consequences if you get it wrong, and as such you should make no decisions on this point without expert (and I mean expert) professional advice.
 
There is extensive discussion of the stamp duty issue here and here.

Bear in mind your obligation to register with the PRTB and you may also have to inform your mortgage provider.

As long as you occupy the property, you will be entitled to avail of the Rent-A-Room Scheme without incurring any stamp duty liability (if you wanted to study etc.).
 
An investor would pay 5% stamp duty on a property under 317,500. So say your property cost €300,000, the SD would be €15,000 in the case of clawback. Would you even get that much money (after expenses) if you rented it out for 6 months to a year? If not, then it's hardly worth renting it all.

If you split your year's absence over two calender years (e.g. Sept 2007 to Aug 2008) then you'd have no problem claiming that you home remained your PPR (assuming you don't rent it out), and that you remained "resident" in Ireland for tax purposes throughout.
 
Thanks a mil for the advice guys, it's really helpful,
Sounds like renting out the whole house isn't feasable. How about under the rent a room scheme? Would we have to physically be there the whole time or would it be ok if we just maintained our ppr status? How would we maintain our ppr status? do we need to be in the country for more than six months or what? does working abroad affect our ppr status, even if its voluntary work?
 
Fiona Fox said:
Thanks a mil for the advice guys, it's really helpful,
Sounds like renting out the whole house isn't feasable. How about under the rent a room scheme? Would we have to physically be there the whole time or would it be ok if we just maintained our ppr status? How would we maintain our ppr status? do we need to be in the country for more than six months or what? does working abroad affect our ppr status, even if its voluntary work?
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I can only repeat what I said above:

This is a complicated issue with drastic financial consequences if you get it wrong, and as such you should make no decisions on this point without expert (and I mean expert) professional advice.
 
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