Is the rental deposit an income re. tax?

Doing my tax for 2007. Should I include the 1000 euro deposit the tenants gave me as income on the rental property, or ignore the deposit and just sum up all actual rent received?

smarthinking said:

Doing my tax for 2007. Should I include the 1000 euro deposit the tenants gave me as income on the rental property, or ignore the deposit and just sum up all actual rent received?

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A deposit is not income - you're holding the deposit until the tenant leaves, at which point you are expected to return it in full unless there are issues (e.g. non payment of bills, issues over notice period, damage beyond expected wear & tear etc). As such it should be available for return at short notice, so don't spend it...

Thanks for the advice. As for keeping the deposit in a safe place, I am afraid it is long gone.......

smarthinking said:

Thanks for the advice. As for keeping the deposit in a safe place, I am afraid it is long gone.......

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So what will you be giving the tenants when they leave?

The physical money is gone but the debt to the tenant still exists and you will have to give back money, equal to the debt (the original deposit) when the tenant leaves. You are only holding it as a trustee and are not entitled to retain the money until the event which gives you legal entitlement to do so occurs. Hence the reason why it's not taxable.

smarthinking said:

Thanks for the advice. As for keeping the deposit in a safe place, I am afraid it is long gone.......

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