Limited interest/Life interest in rental property to wife

murphaph1

Registered User
Messages
297
Hi all,
I'm trying to get some of my affairs in order (hence the flurry of posts from me) and I would like to discuss the idea of granting an interest in my rental property in Ireland to my wife. I have two houses in Dublin and a half share some light industrial units also in Dublin. All of these belonged to me before we married. We are both resident and tax resident in Germany. One of the houses has a small mortgage of ca 15k outstanding. Due to be cleared in December 2024. Maybe the bank would be a problem here?

It would mostly be so that we could get to use our married tax credit rather than just my single tax credit. That's worth 1700 cash money in our pockets every year I guess.

Is there any downside or obstacles to the plan? Does it even make any sense or is it complete nonsense?

What about the costs? I presume this needs to be done by a solicitor and lodged with the land registry or something? How exactly does it work in Ireland?

For reference and in case it makes any difference, rents from almost all EU states are not taxed in Germany and do not need to be declared on the tax return.
 
Do neither of you have any income outside Ireland?
We both do. Does that scupper the plan? Ah yes of course, the pro-rata tax credit rules. I completely forgot about that. I guess I will have to put the plan on ice for a few years until my wife retires. At that stage our Irish income should form just about 75% of our worldwide income assuming I can "offload" my German rental property to my son.

I guess there might still be some merit to the plan as I am paying a small amount of tax at the top rate and this could be at 20% instead if we were jointly assessed, right?
 
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