Rental Income

L

Leon76

Registered User
Messages
29
Hi

Just have a question in relation to rental income.I've recently let a property which I purchased with my partner for €296,000. We are recieving €1350 per month in rental income. In order to comply with tax regulations how do we calculate the rental income on this property. We pay a mortgage of €1211.00 per month.Appreciate your help.
 
The Rental Income is the amount you receive during the calander year
1350 *12 = 16,200
You are allowed deduct some expenses

The main ones are
Mortgage interest only (ask your mortgage provider) 296,000 @ 3.5% will be 10,360 pa

Fixtures & Fittings 1/8 per year for eight years

Insurance

Maintenance Fees etc

The gain is then taxable at your marginal rate 20% or 42%
 
onekeano said:
That's the first time I've heard of that!

Roy
Click to expand...


Well revenue just took 2% off me on my returns for 2004. Do you think it's not correct?

Please let me know so that I can try to get it back!
 
We recently built a new house, but we kept our old house, which we now rent on a weekly basis. Our mortage was taken out on the old, rental, house. I am working and earning enough to pay tax at the top rate. My wife, however, is not employed (she is a home-maker, housewife, or whatever the current PC term for it is) and has no income. The house is registered in her name.

Would we be better off having the house jointly owned and pay the tax jointly, or would we be better off having my wife providing Self Assessments for her income on this property? Basically would there be any financial, or tax gains by having her declare the income as her own and seperate from myself?
 
Its is better from a tax point to have the property in your wifes name. As she will not be using her tax band and since only part of the tax band can be transfered to you. This should mean surplus rent is taxable at 20% plus levies as opposed to 42% plus levies.
 
This probably means that I will no longer get the Home Carers allowance. Also, if we are declaring taxes seperately then my tax payments (+PRSI ??) would go up, correct? Would the gains definitely offset the losses?
 
If the rental income after expenses is less than Euro 5080 then it should have no effect on the home carers credit.
Yes it should benefit as your wife will pay tax at 20% comparer to you at 42%
 
Cnoc said:
Would the gains definitely offset the losses?
Click to expand...
Without having access to the full details (any extra consequences of the move.... may not just be the careers allowance that has to be looked at) nobody on the site can give you a definite answer.

It does seem however that the benefits of you receiving her allocation (or at least the portion available) of credits would make financial sense. If you want a definite answer, seek advice from someone who can investigate it fully (has access to your financial information [P60, P45 etc]), you'll have a fair idea if you use one of the tax calculators available on the site to what the benefits may be.
 
You must log in or register to reply here.
Back
Top